Ｎotes on "What drives business cycle and international trade in emerging market economies" (by Marcelo Sanchez)

What drives business cycle and international trade in emerging market economies
by Marcelo Sanchez

• uses data from fifteen EM countries
• small open economy model (similar in Kollmann 2001) (model developed from microeconomics model)
• four types of shocks: technology shocks, preference shocks, monetary shocks, risk premium shocks
• be built from Faust (1998), Canova and De Nicolò (2002) and Uhlig (2005) 
• different countries are influenced by different factors and have different responses to shocks
• both real and nominal rates should be considered, especially in countries with unachieved inflation targets