Are Output Fluctuations Transitory?

John Campbell and N. Gregory Mankiw

Scholarly Articles from Harvard University Department of Economics

Abstract: According to the conventional view of the business cycle, fluctuations in output represent temporary deviations from trend. The purpose of this paper is to question this conventional view. If fluctuations in output are dominated by temporary deviations from the natural rate of output, then an unexpected change in output today should not substantially change one's forecast of output in, say, five or ten years. Our examination of quarterly postwar United States data leads us to be skeptical about this implication. The data suggest that an unexpected change in real GNP of 1 percent should change one's forecast by over 1 percent over a long horizon.

Date: 1987
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (367)

Published in Quarterly Journal of Economics

Downloads: (external link)
http://dash.harvard.edu/bitstream/handle/1/3122545/campbell_output.pdf (application/pdf)

Related works:
Journal Article: Are Output Fluctuations Transitory? (1987)
Working Paper: Are Output Fluctuations Transitory? (1986)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hrv:faseco:3122545

Access Statistics for this paper

More papers in Scholarly Articles from Harvard University Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Office for Scholarly Communication ().