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Finally, Mr Borio recommends revising the woolly concept of "potential" output.
Because the growth of potential output has slowed in major economies since the crisis, future trend growth may be weaker than anticipated".
An output gap is based on educated guess work, given the level of potential output is never actually observed but has to be estimated.
There is downward pressure on prices all the time that actual output falls short of potential output, and the size of this output gap is growing.
If that drop is permanent, it would alone entail a significant decline in the level of potential output.
And this is important: those pessimistic assessments of potential output play an important role in the UK austerity frenzy.
Similar(26)
Because of the diversity of potential outputs from the LTS data, we evaluated algorithm performance against summary metrics for disturbance, recovery, and stability, both for capture of events and longer-duration processes.
The study protocols described in the manuscript represent an effort to inform the scientific community of potential outputs from a major national project, while adding transparency and accessibility to the methods that have been conceptualised to fulfil each project objective.
Well, White simply asserts that the natural rate of interest equals the rate of growth of world potential output.
In the case of under-education, the cost is the lost opportunity, in terms of future potential output, of not giving enough formal education (or setting adequate incentives for doing so) to otherwise capable people.
On Oct. 19, an Iraqi oil official told reporters that Exxon was in the front running for a contract to develop the West Qurna field's 8.7 billion barrels of oil (potential output of 1.5 million barrels per day).
More suggestions(15)
of potential performance
of potential export
of potential productivity
of possible output
of potential product
of potential material
of power output
of potential secondary
of interest output
of potential products
of potential damage
of potential embarrassment
of potential contamination
of creative output
of global output
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com