Improving GDP Measurement: A Forecast Combination Perspective

30 Pages Posted: 21 Sep 2011

See all articles by S. Borağan Aruoba

S. Borağan Aruoba

University of Maryland - Department of Economics

Francis X. Diebold

University of Pennsylvania - Department of Economics; National Bureau of Economic Research (NBER)

Jeremy Nalewaik

Board of Governors of the Federal Reserve System

Frank Schorfheide

University of Pennsylvania - Department of Economics; Centre for Economic Policy Research (CEPR)

Dongho Song

Johns Hopkins University - Carey Business School

Multiple version iconThere are 3 versions of this paper

Date Written: September 19, 2011

Abstract

Two often - divergent U.S. GDP estimates are available, a widely-used expenditure-side version GDPE, and a much less widely-used income-side version GDI . The authors propose and explore a "forecast combination" approach to combining them. They then put the theory to work, producing a superior combined estimate of GDP growth for the U.S., GDPC. The authors compare GDPC to GDPE and GDPI , with particular attention to behavior over the business cycle. They discuss several variations and extensions.

Keywords: National Income and Product Accounts, Output, Expenditure, Economic Activity, Business Cycle, Recession

JEL Classification: E01, E32

Suggested Citation

Aruoba, S. Boragan and Diebold, Francis X. and Nalewaik, Jeremy John and Schorfheide, Frank and Song, Dongho, Improving GDP Measurement: A Forecast Combination Perspective (September 19, 2011). FRB of Philadelphia Working Paper No. 11-41. Available at SSRN: https://ssrn.com/abstract=1931651 or http://dx.doi.org/10.2139/ssrn.1931651

S. Boragan Aruoba (Contact Author)

University of Maryland - Department of Economics ( email )

College Park, MD 20742
United States
301-405-3508 (Phone)
301-405-3542 (Fax)

Francis X. Diebold

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-1507 (Phone)
215-573-4217 (Fax)

HOME PAGE: http://www.ssc.upenn.edu/~fdiebold/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Jeremy John Nalewaik

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

Frank Schorfheide

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States

HOME PAGE: http://www.econ.upenn.edu/~schorf

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Dongho Song

Johns Hopkins University - Carey Business School ( email )

Baltimore, MD 20036-1984
United States

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