‘Great moderation’ due to weaker recoveries, paper argues
Post-1945 fall in US volatility saw changes to both recessions and recoveries
The "great moderation" of the US economy since the 1980s was due primarily to a fall in the strength of economic recoveries, a working paper published recently by the Bank of Spain argues.
In The Great Moderation in historical perspective – is it that great?, María Dolores Gadea, Ana Gómez-Loscos and Gabriel Perez-Quiros examine the "great moderation". This is the commonly-used term for the "significant decline in macroeconomic volatility" in the US that began in the 1980s.
Their paper, the
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