Document Type

Article

Publication Date

11-2020

Publisher

Elsevier

Source Publication

Economics Letters

Source ISSN

0165-1765

Abstract

This paper studies how expectations regarding current and future output growth are revised as the state of the economy evolves. We study this issue using GDP growth forecasts from the Survey of Professional Forecasters. We find an asymmetric relationship between forecast revisions and GDP growth. Forecasters make larger forecast revisions during contractions than during expansions when the deviation of the economy from its normal state is controlled for.

Comments

Accepted version. Economics Letters, Vol. 196, (2020): 109541. DOI. © 2020 Elsevier. Used with permission.

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