Recent Changes in the U.S. Business Cycle
37 Pages Posted: 9 Aug 2006
There are 3 versions of this paper
Recent Changes in the U.S. Business Cycle
Date Written: April 2001
Abstract
The U.S. business cycle expansion that started in March 1991 is the longest on record. This paper uses statistical techniques to examine whether this expansion is a onetime unique event or whether its length is a result of a change in the stability of the U.S. economy. Bayesian methods are used to estimate a common factor model that allows for structural breaks in the dynamics of a wide range of macroeconomic variables. We find strong evidence that a reduction in volatility is common to the series examined. Further, the reduction in volatility implies that future expansions will be considerably longer than the historical average.
Keywords: business cycle, recession, dynamic factor, bayesian
JEL Classification: E52, C53
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Has the Business Cycle Changed and Why?
By James H. Stock and Mark W. Watson
-
Output Fluctuations in the United States: What Has Changed Since the Early 1980s?
-
Time Varying Structural Vector Autoregressions and Monetary Policy
-
Recent U.S. Macroeconomic Stability: Good Policies, Good Practices, or Good Luck?
By Shaghil Ahmed, Andrew T. Levin, ...
-
On the Causes of the Increased Stability of the U.S. Economy
By James A. Kahn, Margaret Mary Mcconnell, ...
-
The Rise in Firm-Level Volatility: Causes and Consequences
By Diego Comin and Thomas Philippon
-
The Rise in Firm-Level Volatility: Causes and Consequences
By Diego Comin and Thomas Philippon
-
The Rise in Firm-Level Volatility: Causes and Consequences
By Diego A. Comin and Thomas Philippon
-
The Estimation of Prewar Gnp: Methodology and New Evidence
By Nathan S. Balke and Robert J. Gordon