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Indicator-based estimates of the output gap in the euro area

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  • Weiske, Sebastian

Abstract

The output gap is a key variable of business cycle analysis and policy. Obtaining reliable estimates for it, is very difficult, though. Most real-time estimates are frequently revised over time. The idea of this paper is to use various indicators, for example from business surveys, that (i) were highly correlated with the output gap in the past and (ii) that are ideally not subject to revisions. According to a real-time analysis, indicator-based estimates prove to be more reliable than estimates from international institutions. Currently, estimates point to positive output gaps in the euro area.

Suggested Citation

  • Weiske, Sebastian, 2018. "Indicator-based estimates of the output gap in the euro area," Working Papers 12/2018, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung.
    • Handle: RePEc:zbw:svrwwp:122018
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    Cited by:

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    2. Kai Carstensen & Felix Kießner & Thies Rossian, 2023. "Estimation of the TFP Gap for the Largest Five EMU Countries," CESifo Working Paper Series 10245, CESifo.
    3. Feld, Lars P. & Schmidt, Christoph M. & Schnabel, Isabel & Truger, Achim & Wieland, Volker, 2019. "Den Strukturwandel meistern. Jahresgutachten 2019/20 [Dealing with Structural Change. Annual Report 2019/20]," Annual Economic Reports / Jahresgutachten, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung, volume 127, number 201920.

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    More about this item

    Keywords

    Business Cycles; Output Gap; Real-time Estimation; Business Survey Data;
    All these keywords.

    JEL classification:

    • 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
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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