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The Ifo Business Cycle Clock: Circular Correlation with the Real GDP

Author

Listed:
  • Klaus Abberger
  • Wolfgang Nierhaus

Abstract

The Ifo Business Climate is the most important indicator for the business cycle in Germany. In 1993 the connection between the two components of the business climate – business situation and business expectations – was graphically portrayed by Ifo in a 4-quadrant scheme: the Ifo Business Cycle Clock. Today similar monitoring systems are firmly established and are presented by Eurostat, the OECD and others. The German Federal Statistical Office presents the real GDP in a 4-quadrant scheme. In the following, important qualities of the Ifo Business Cycle Clock are shown. The importance of orthogonal functions for the circular correlation is examined.

Suggested Citation

  • Klaus Abberger & Wolfgang Nierhaus, 2010. "The Ifo Business Cycle Clock: Circular Correlation with the Real GDP," CESifo Working Paper Series 3179, CESifo.
    • Handle: RePEc:ces:ceswps:_3179
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    References listed on IDEAS

    as
    1. Klaus Abberger & Wolfgang Nierhaus, 2009. "Months for cyclical dominance and the Ifo Business Climate," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 62(07), pages 11-19, April.
    2. repec:ces:ifosdt:v::y:2009:i::p:34-41 is not listed on IDEAS
    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. Klaus Abberger & Wolfgang Nierhaus, 2010. "Markov-Switching and the Ifo Business Climate: the Ifo Business Cycle Traffic Lights," OECD Journal: Journal of Business Cycle Measurement and Analysis, OECD Publishing, Centre for International Research on Economic Tendency Surveys, vol. 2010(2), pages 1-13.
    5. Geoffrey H. Moore & Julius Shiskin, 1967. "Indicators of Business Expansions and Contractions," NBER Books, National Bureau of Economic Research, Inc, number moor67-2, March.
    6. Klaus Abberger & Wolfgang Nierhaus, 2007. "The Ifo Business Climate: A reliable leading indicator," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 60(05), pages 25-30, March.
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    9. Klaus Abberger & Wolfgang Nierhaus, 2008. "How to Define a Recession?," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(04), pages 74-76, December.
    10. Klaus Abberger & Klaus Wohlrabe, 2006. "Forecasting qualities of the Ifo Business Climate Index - a look at recent studies," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 59(22), pages 19-26, November.
    11. Klaus Abberger & Manuel Birnbrich & Christian Seiler, 2009. "Survey of the survey in distribution - a meta-survey on the Ifo Business Survey," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 62(21), pages 34-41, November.
    12. Klaus Abberger & Wolfgang Nierhaus, 2010. "The Ifo Business Cycle Clock: circular correlation with GDP," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 63(05), pages 32-43, March.
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    Cited by:

    1. Elsayyad, May & Konrad, Kai A., 2012. "Fighting multiple tax havens," Journal of International Economics, Elsevier, vol. 86(2), pages 295-305.
    2. Robert Lehmann, 2023. "The Forecasting Power of the ifo Business Survey," Journal of Business Cycle Research, Springer;Centre for International Research on Economic Tendency Surveys (CIRET), vol. 19(1), pages 43-94, March.
    3. Tadeusz Kufel, 2021. "Covid-19 Pandemic Lockdown vs. Business Cycle Clock Registration of New Passenger Cars in European Countries," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 1), pages 875-890.
    4. Klaus Abberger & Wolfgang Nierhaus, 2010. "Drei Monitorsysteme zur Analyse der sächsischen Industriekonjunktur," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 17(06), pages 33-39, December.

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    More about this item

    Keywords

    Ifo business climate; growth cycle; circular correlation; linear-circular correlation; temporal disaggregation;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • C39 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Other
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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