When Did the Recession Begin?


As noted in the post below this one, the NBER has dated the beginning of the recession as December 2007. Brad DeLong says that “I think that this was the right way to call it…” However a colleague, Jeremy Piger, has a recession dating model that indicates it wasn’t exactly clear when the recession began. His recession probabilities are:

200705 1.2%
200706 1.4%
200707 1.8%
200708 2.9%
200709 4.6%
200710 7.3%
200711 10.4%
200712 17.1%
200801 23.6%
200802 33.1%
200803 37.4%
200804 42.7%
200805 47.7%
200806 54.9%
200807 66.0%
200808 96.2%
200809 99.2%

According to these numbers, one could reasonably put the peak anywhere from October 2007 to May of 2008. Here’s a graph of the recession probabilities from June 1967 through September 2008: 

Historical Recession Probabilities


About Mark Thoma 243 Articles

Affiliation: University of Oregon

Mark Thoma is a member of the Economics Department at the University of Oregon. He joined the UO faculty in 1987 and served as head of the Economics Department for five years. His research examines the effects that changes in monetary policy have on inflation, output, unemployment, interest rates and other macroeconomic variables with a focus on asymmetries in the response of these variables to policy changes, and on changes in the relationship between policy and the economy over time. He has also conducted research in other areas such as the relationship between the political party in power, and macroeconomic outcomes and using macroeconomic tools to predict transportation flows. He received his doctorate from Washington State University.

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