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On quantitative and graphical measures of the severity of New Zealand’s recessions and strength of its expansions

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Abstract

We develop three measures for the shape of business cycle phases, reflecting excess gains and losses relative to constant quarterly growth across the phase. These measures can be seen as representing better or worse economic outcomes during recession and expansion phases relative to constant growth rate paths and, as a consequence, provide summary evaluation measures for such economic outcomes. Using a phase’s constant quarterly growth rate as the benchmark, our methodology builds on Harding and Pagan (2016) by developing quantitative measures that have useful economic interpretations and which are amenable to informative graphical display and analysis. Empirical outcomes are provided for New Zealand’s recession and expansion phases.

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  • Viv B. Hall & John McDermott & Peter Thomson, 2026. "On quantitative and graphical measures of the severity of New Zealand’s recessions and strength of its expansions," Motu Working Papers 26_02, Motu Economic and Public Policy Research.
    • Handle: RePEc:mtu:wpaper:26_02
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    References listed on IDEAS

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    1. Viv B. Hall & C. John McDermott, 2011. "A quarterly post-Second World War real GDP series for New Zealand," New Zealand Economic Papers, Taylor & Francis Journals, vol. 45(3), pages 273-298, March.
    2. Viv B. Hall & C. John McDermott, 2016. "Recessions and recoveries in New Zealand's post-Second World War business cycles," New Zealand Economic Papers, Taylor & Francis Journals, vol. 50(3), pages 261-280, September.
    3. Durbin, James & Koopman, Siem Jan, 2012. "Time Series Analysis by State Space Methods," OUP Catalogue, Oxford University Press, edition 2, number 9780199641178.
    4. Don Harding & Adrian Pagan, 2016. "The Econometric Analysis of Recurrent Events in Macroeconomics and Finance," Economics Books, Princeton University Press, edition 1, number 10744, December.
    5. Harding, Don & Pagan, Adrian, 2002. "Dissecting the cycle: a methodological investigation," Journal of Monetary Economics, Elsevier, vol. 49(2), pages 365-381, March.
    6. Gerhard Bry & Charlotte Boschan, 1971. "Standard Business Cycle Analysis of Economic Time Series," NBER Chapters, in: Cyclical Analysis of Time Series: Selected Procedures and Computer Programs, pages 64-150, National Bureau of Economic Research, Inc.
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    Keywords

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    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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