The role of global, euro area and country-specific shocks in business cycle dynamics of six euro area member countries is assessed with the aid of SVAR models. Output fluctuations are driven by global shocks to a large extent in the euro area, and no Europeanisation of business cycles due to, for example the European Monetary Union, could be established. Business cycle heterogeneity is driven mainly by (asymmetric) country-specific shocks in the euro area and not by heterogeneous responses to common, particularly global, shocks. The cyclical disparity across the member economies is found to be small relative to the size of business cycles.

JEL classification: E32, C32, F00

Keywords: European Monetary Union, international business cycles, common and country-specific shocks, structural vector autoregression