The Effect of Recessions on the Relationship between Output Variability and Growth
This paper investigates the relationship between output volatility and growth using post-war real GDP data for the United States. We expand on recent research by Beaudry and Koop (1993) documenting the asymmetric effect of recessions on output growth. The results presented in this paper suggest that output volatility is highest when the economy is contracting. While we find that the economy expands most rapidly following a recession, this expansion is offset by the negative impact of output uncertainty.
|Date of creation:||2000|
|Contact details of provider:|| Postal: Department of Economics, The University of Melbourne, 4th Floor, FBE Building, Level 4, 111 Barry Street. Victoria, 3010, Australia|
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Web page: http://fbe.unimelb.edu.au/economics
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