Leading indicators: myth or legend?
University essay from Lunds universitet/Nationalekonomiska institutionen
Abstract: In this thesis we analyze the predictive power of various traditionally leading indicators of GDP-growth. We apply a dynamic panel data estimation approach and use variables categorized in to two groups; survey indicators and economic variables. The sample is transformed using a wavelet analysis to obtain the short-, medium- and long run impact of the variables. The results show that there are difficulties in estimating the short run fluctuations while there is large explanatory power in the medium run.
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