Abstract: Almost all recent research on macroeconomic fluctuations has worked with seasonally adjusted or annual data. This paper takes a different approach by treating fluctuations as worthy of study in their own right. We document the quantitative importance of fluctuations, and we present estimates of the patterns in a set of standard macroeconomic variables. Our results show that fluctuations are an important source of variation in all macroeconomic quantity variables but small or entirely absent in both real and nominal price variables. The timing of the fluctuations consists of increases in the second and fourth quarter, a large decrease in the first quarter, and a mild decrease in the third quarter. The paper demonstrates that, with respect to each of several major stylized facts about business cycles, the displays the same characteristics as the business cycle, in some cases even more dramatically than the business cycle. That is, we find that at frequencies as well as at business frequencies, output movements across broadly defined sectors move together, the timing of production and sales coincide closely, labor productivity is procyclical, nominal money and real output are highly correlated, and prices vary less than quantities. There is a seasonal business cycle in the United States economy, and its characteristics mirror closely those of the conventional business cycle.
Publication Year: 1988
Publication Date: 1988-08-01
Language: en
Type: preprint
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Cited By Count: 1
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