The Two Greatest. Great Recession vs. Great Moderation

Pérez-Quirós, Gabriel, María Gadea () and Ana Gómez-Loscos
Authors registered in the RePEc Author Service: Gabriel Perez Quiros

No 10092, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: The collapse of the global economy in 2008, following the outbreak of the financial crisis, and the ensuing economic developments of the so-called Great Recession (GR) led many economists to suggest that the Great Moderation (GM) had, indeed, come to an end. This paper offers evidence that the decrease in output volatility still remains in force despite the GR and would do so even if the GR continues to extended horizons. This finding has important implications not only for academics, concerning the implementation of theoretical and empirical techniques, but also for policymakers, regarding the understanding of the pattern of recovery from the current and future recessions

Keywords: Business cycle; Markov switching models; Volatility; Recoveries (search for similar items in EconPapers)
JEL-codes: C22 E32 (search for similar items in EconPapers)
Date: 2014-08
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

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