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All the same, Reid has seen a decline in potential incomes for her fellow authors.
These methods automatically interpret any sustained decline in actual output as a decline in potential, and they cause that re-estimate to propagate backward through time.
Zhiwei Zhang, an economist at the investment bank Nomura, warned in a report last Friday that "China is displaying the same three symptoms that Japan, the U.S. and parts of Europe all showed before suffering financial crises: a rapid build-up of leverage, elevated property prices and a decline in potential growth".
Update: I should have mentioned that the CBO doesn't use the filtering method in its estimates for the US; as best I understand it, it uses a production function approach that is much less likely to interpret a prolonged slump as a decline in potential output.
The statistical techniques policy makers often use to estimate the economy's "potential" — the maximum level of output and employment it can achieve without inflationary overheating — turn out to be badly flawed: they interpret any sustained economic slump as a decline in potential, so that the hawks can point to charts and spreadsheets supposedly showing that there's not much room for growth.
At lower sites, drought leads to a decline in potential timber production and a shift towards more drought-tolerant species.
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During prolonged cultivation ex vivo, adult bone marrow stromal stem cells (BMSCs) undergo two probably interdependent processes, replicative aging and a decline in differentiation potential.
This increase in Treg apoptosis was found to correlate with a decline in suppressive potential of these cells.
Whereas habituation is correlated with a decline in postsynaptic potentials, sensitization is correlated with an increase in the magnitude of postsynaptic potentials at the same locus.
For example, Mr Williams' updated estimates imply the real natural rate of interest was -0.2% at the end of 2013, owing both to high desired saving, and a steady decline in potential growth, to about 2% now from 2.9% in 2007.Your choice of interest rate path thus depends heavily on how you interpret recent data.
Given the lofty price of the average Janus holding, even a tiny decline in potential growth can undermine the rationale for holding it.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com