Read Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts"

Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts"

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Description:Potential output-in the sense of the GDP level or path an economy can sustain over the medium term-is a crucial benchmark for policymakers. However, it is difficult to estimate when financial "booms and busts" are driving the real economy. This paper uses a simple multivariate filtering approach to illustrate the role financial variables play in driving potential or sustainable output. The results suggest that it moves more steadily during financial "boom and bust" periods than implied by conventional HP filter estimates, which tend to more closely follow actual GDP. A two-region, multisector New Keynesian DSGE model with financial frictions sheds light on the economic forces that could be behind the results obtained from the filter. This has important implications for policymakers.We have made it easy for you to find a PDF Ebooks without any digging. And by having access to our ebooks online or by storing it on your computer, you have convenient answers with Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts". To get started finding Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts", you are right to find our website which has a comprehensive collection of manuals listed.
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Pages: 33

Format: PDF, EPUB & Kindle Edition

Publisher: International Monetary Fund

Release: 2015

ISBN: 1513503073

Description: Potential output-in the sense of the GDP level or path an economy can sustain over the medium term-is a crucial benchmark for policymakers. However, it is difficult to estimate when financial "booms and busts" are driving the real economy. This paper uses a simple multivariate filtering approach to illustrate the role financial variables play in driving potential or sustainable output. The results suggest that it moves more steadily during financial "boom and bust" periods than implied by conventional HP filter estimates, which tend to more closely follow actual GDP. A two-region, multisector New Keynesian DSGE model with financial frictions sheds light on the economic forces that could be behind the results obtained from the filter. This has important implications for policymakers.We have made it easy for you to find a PDF Ebooks without any digging. And by having access to our ebooks online or by storing it on your computer, you have convenient answers with Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts". To get started finding Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts", you are right to find our website which has a comprehensive collection of manuals listed.
Our library is the biggest of these that have literally hundreds of thousands of different products represented.

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Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts"

Steady as She Goes-Estimating Potential Output During Financial "Booms and Busts"

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