Page - 115 - in The Austrian Business Cycle in the European Context

115 Detecting turning points with the Bry-Boschan procedure seems to be an arbitrary procedure in the case of remaining high- frequency components. Therefore, the results based on BK-filtered data are most convincing, and some of them are mirrored in HP- filtered data. This is especially the case for German gross value added (without agriculture and forestry). Focussing on these re- sults, the most important time series show the same number of cy- cles as the reference series, if we discard the last turning point of the reference series which is not reflected in other series. This rein- forces the perception of a common business cycle driving the largest part of economic time series. Thus, seven cycles have been detected in the Austrian reference series, with a length of ap- proximately 15 to 16 quarters. Phase lengths are reported to be symmetric. Mean and average distances of turning points suggest for the euro area business cycle anything between a small lead and coincident behaviour with respect to the Austrian cycle. The German business cycle, represented by business cycle variations contained in its gross value added (excluding agriculture and for- estry), has been confirmed as leading by half a quarter according to mean and median distances. Industrial production of Germany shows the longest lead by one quarter, whereas Austrian industrial production leads by only half a quarter. Further robust results are a lead of the Austrian construction industry and a lag of Austrian fi- nancial intermediation, real estate, renting and business services. 8.3.2 Dating the business cycle in the dynamic factor model framework Results are conveyed by the dates of the turning points in Ta- ble A 8. There, the dates are calculated by the Bry-Boschan rou- tine, using the same settings and restrictions concerning phase, cycle length and the length of the Bartlett smoothing window as for the just cleaned series. For first-order differences, dates of turn- ing points are the same for these two approaches till the first quar- ter 1980. However, the subsequent cycle is dated differently.