Business cycles and the scale of economic shock

 Mario Coccia
National Research Council (Italy)
CERIS-CNR

via Real Collegio, n. 30, 10024 Moncalieri (Torino) - Italy
Tel.: +39 011 68 24 925; fax : +39 011 68 24 966
m.coccia@ceris.cnr.it

Abstract: The purpose of this paper is to determine the scale of economic shocks (SES), considering a new indicator based on the duration (in months) of contractions and expansions within Business Cycles and their amplitude, measured by GDP percent change based on chained 2000 dollars. Data of US Business cycles are used. The result is that the SES shows the real economic impact of contractions and expansions over time and serves as a warning signal that the economic system is entering into a turbulent state in the short-run.  

Keywords: Business Cycles, Economic shock, Contractions, Expansions

 JEL-codes: E30, E32, E37

I wish to thank Silvana Zelli and Diego Margon for research assistance and the Italian National Research Council for its financial support to this research. The comments of two anonymous referees have been appreciated.

SCARICA QUESTO WP