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Examining the Quality of Early GDP Component Estimates

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  • Tara M. Sinclair

    ()
    (George Washington University)

  • H.O. Stekler

    ()
    (George Washington University)

Abstract

In this paper we examine the quality of the initial estimates of headline GDP and 10 major components of both real and nominal U.S. GDP. We ask a number of questions about various characteristics of the differences between the initial estimates available one month after the end of the quarter to the estimates available three months after the end of the quarter. Do the first estimates have the same directional signs as the later numbers? Are the original numbers unbiased estimates of the later figures? Are any observed biases related to the state of the economy? Finally, we determine whether there is a significant difference between the vector of the 30 day estimates of the 10 major components and the vector of the 90 day estimates of the same components. We conclude that, despite the existence of some bias, under most circumstances, an analyst could use the early data to obtain a realistic picture of what had happened in the economy in the previous quarter.

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File URL: http://www.gwu.edu/~forcpgm/2011-001.pdf
File Function: Second version, 2011
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Bibliographic Info

Paper provided by The George Washington University, Department of Economics, Research Program on Forecasting in its series Working Papers with number 2011-001.

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Length: 35 pages
Date of creation: Feb 2011
Date of revision: Dec 2011
Handle: RePEc:gwc:wpaper:2011-001

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Keywords: Flash Estimates; Data Revisions; GDP Components; Statistical Tests; Business Cycles;

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Citations

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Cited by:
  1. Tara M. Sinclair & H.O. Stekler & Warren Carnow, 2012. "Evaluating A Vector Of The Fed’S Forecasts," Working Papers 2012-002, The George Washington University, Department of Economics, Research Program on Forecasting.
  2. repec:amu:wpaper:2013-04 is not listed on IDEAS
  3. Tara M. Sinclair, 2012. "Characteristics and Implications of Chinese Macroeconomic Data Revisions," Working Papers 2012-09, The George Washington University, Institute for International Economic Policy.

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