This paper investigates the determinants of business cycle comovement between countries. Our
dataset includes over 100 countries, both developed and developing. We search for variables
that are “robust” in explaining comovement, using the approach of Leamer (1983). Variables
considered are (i) bilateral trade between countries; (ii) total trade in each country; (iii) sectoral
structure; (iv) similarity in export and import baskets; (v) factor endowments; and (vi) gravity
variables. We find that bilateral trade is robust. However, two variables that the literature has
argued are important for business cycles—industrial structure and currency unions—are found
not to be robust.