Do alternative measures of GDP affect its interpretation?
Abstract: Gross domestic product's high correlation with unemployment and inflation makes it a key measure of the U.S. economy. Yet the somewhat arbitrary nature of the GDP construction process complicates interpretation and measurement of the indicator. A study of an alternative measure of GDP designed to address the published series' limitations finds that the adjusted measure differs in its representation of the long-term trend--but not the short-term fluctuations--of GDP. The published series' relevance as an indicator is therefore robust to some of the arbitrariness of its construction.
Keywords: Econometrics; Gross domestic product; Economic indicators;
File(s): File format is application/pdf https://www.newyorkfed.org/medialibrary/media/research/current_issues/ci15-7.pdf
File(s): File format is text/html https://www.newyorkfed.org/medialibrary/media/research/current_issues/ci15-7.html
Provider: Federal Reserve Bank of New York
Part of Series: Current Issues in Economics and Finance
Publication Date: 2009
Order Number: 7