Decision Making in hard Times: What is a Recession, Why Do We Care and How Do We Know When We Are in One?

Kevin Lee (), Anthony Garratt and Kalvinder Shields

No 09/22, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: Defining a recessionary event as one which impacts adversely on individuals’ economic well-being, the paper argues that recession is a multi-faceted phenomenon whose meaning differs from person to person as it impacts on their decision-making in real time. It argues that recession is best represented through the calculation of the nowcast of recession event probabilities. A variety of such probabilities are produced using a real-time data set for the US for the period, focusing on the likelihood of various recessionary events through 1986q1-2008q4 and on prospects beyond the end of the sample.

Keywords: Recession; Probability Forecasts; Real Time (search for similar items in EconPapers)
JEL-codes: E52 E58 (search for similar items in EconPapers)
Date: 2009-10
New Economics Papers: this item is included in nep-ets and nep-mac
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Related works:
Journal Article: Decision-making in hard times: What is a recession, why do we care and how do we know when we are in one? (2011)
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