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Could The Start Of The German Recession 2008-2009 Have Been Foreseen? Evidence From Real-Time Data

Author

Listed:
  • Ulrich Heilemann

    (Universität Leipzig)

  • Susanne Schnorr-Bäcker

    (Statistisches Bundesamt)

Abstract

Given that the Great Recession in Germany was neither predicted nor identified at the time, this paper examines whether data available could have helped to predict or identify the crisis in real time. We inspect forecasts published during April–December 2008 by 12 major institutions, for available data: real-time data from official statistics for Germany and the European Union, major surveys, and indicators. Although annual real GDP forecasts for 2008 were rather accurate, forecasters failed to observe the onset of the recession in Q2 2008, though from May onward, an increasing amount of data—neither ambiguous nor misleading—indicated that the economy was in recession or would likely enter one soon. Nevertheless, forecasters recognised the recession only in mid-November, when the country was already seven months into the recession, thereby confirming forecasters’ ‘low priors about the likelihood of a recession’.

Suggested Citation

  • Ulrich Heilemann & Susanne Schnorr-Bäcker, 2016. "Could The Start Of The German Recession 2008-2009 Have Been Foreseen? Evidence From Real-Time Data," Working Papers 2016-003, The George Washington University, Department of Economics, H. O. Stekler Research Program on Forecasting.
    • Handle: RePEc:gwc:wpaper:2016-003
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    File URL: https://www2.gwu.edu/~forcpgm/2016-003.pdf
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    Cited by:

    1. Susanne Schnorr-Bäcker, 2016. "Politik begleitendes statistisches Monitoring und neue Datenquellen [Monitoring statistics for politics and new data sources]," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 10(2), pages 163-185, October.
    2. Ademmer, Martin & Boysen-Hogrefe, Jens & Fiedler, Salomon & Groll, Dominik & Jannsen, Nils & Kooths, Stefan & Potjagailo, Galina & Wolters, Maik H., 2017. "Deutsche Konjunktur im Herbst 2017 - Deutsche Wirtschaft nähert sich der Hochkonjunktur [German Economy Autumn 2017 - German economy approaches boom period]," Kieler Konjunkturberichte 35, Kiel Institute for the World Economy (IfW Kiel).

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    More about this item

    Keywords

    Forecast accuracy; Great Recession; real-time analysis; data processing;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications

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