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Another Look at the Ifo Business Cycle Clock

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  • Klaus Abberger

Abstract

Business tendency surveys are a popular instrument for business cycle analysis. The survey results are used to calculate leading business cycle indicators. For Germany the Ifo Institute publishes the Ifo business climate, which consists of the results of two questions: one question about the current situation of the respondents and a second question about their expectations for the coming months. The business climate combines the answers on both questions to a single indicator. This indicator is closely watched by the public. To visualize the interactions between the two components behind this indicator, the Ifo Institute developed a graphical representation called the Ifo business cycle clock. This article shows, with the help of circular-linear correlation analysis, that this illustration is indeed valuable. But it also shows that the clock times should be interpreted carefully.

Suggested Citation

  • Klaus Abberger, 2006. "Another Look at the Ifo Business Cycle Clock," Journal of Business Cycle Measurement and Analysis, OECD Publishing, Centre for International Research on Economic Tendency Surveys, vol. 2005(3), pages 431-443.
    • Handle: RePEc:oec:stdkaa:5l9k4xsjg6mn
    DOI: 10.1787/jbcma-v2005-art12-en
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    Citations

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    Cited by:

    1. Nuno Lourenço & António Rua, 2023. "Business cycle clocks: Time to get circular," Empirical Economics, Springer, vol. 65(4), pages 1513-1541, October.
    2. Klaus Abberger & Wolfgang Nierhaus, 2011. "Die ifo Konjunkturuhr: Zirkulare Korrelation mit dem realen Bruttoinlandsprodukt," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 5(3), pages 179-201, December.
    3. Klaus Abberger & Wolfgang Nierhaus, 2008. "The Ifo Business-Cycle Clock: A precision instrument for the analysis of the economy," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 61(23), pages 16-24, December.
    4. Wolfgang Nierhaus & Timo Wollmershäuser, 2016. "ifo Konjunkturumfragen und Konjunkturanalyse: Band II," ifo Forschungsberichte, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 72, October.
    5. António Rua & Nuno Lourenço, 2022. "Business cycle clocks: Time to get circular," Working Papers w202201, Banco de Portugal, Economics and Research Department.
    6. Klaus Abberger & Sascha Becker & Barbara Hofmann & Klaus Wohlrabe, 2007. "Mikrodaten im ifo Institut für Wirtschaftsforschung – Bestand, Verwendung und Zugang," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 1(1), pages 27-42, June.
    7. Hanjo Odendaal & Monique Reid & Johann F. Kirsten, 2020. "Media‐Based Sentiment Indices as an Alternative Measure of Consumer Confidence," South African Journal of Economics, Economic Society of South Africa, vol. 88(4), pages 409-434, December.
    8. Klaus Abberger & Wolfgang Nierhaus, 2010. "The Ifo Business Cycle Clock: Circular Correlation with the Real GDP," CESifo Working Paper Series 3179, CESifo.
    9. Sascha O. Becker & Klaus Wohlrabe, 2008. "European Data Watch: Micro Data at the Ifo Institute for Economic Research – The “Ifo Business Survey”, Usage and Access," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 128(2), pages 307-319.
    10. Aslihan Atabek Demirhan & Evren Erdogan Cosar, 2012. "Iktisadi Faaliyet Analizi : Oncu Gostergeler ve Ekonomi Saati Yaklasimi," CBT Research Notes in Economics 1202, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    11. António Rua & Nuno Lourenço, 2022. "A circular business cycle clock for Portugal," Economic Bulletin and Financial Stability Report Articles and Banco de Portugal Economic Studies, Banco de Portugal, Economics and Research Department.

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