Gross domestic product's high correlation with unemployment and inflation makes it a key measure of the U.S. economy. Yet the somewhat arbitrary nature of the GDP construction process complicates interpretation and measurement of the indicator. A study of an alternative measure of GDP designed...

In the wake of the most recent U.S. recession, both New York State and New Jersey have faced multibillion-dollar budget gaps. An analysis of the makeup of their budgets reveals that the states' heavy reliance on personal income taxes--particularly from high-wage earners in the finance...

Business surveys often give early signals of the direction and magnitude of economic activity. One release, the relatively new Empire State Manufacturing Survey, is demonstrating an ability to provide information ahead of U.S. production and employment trends. In fact, the predictive power of...

A two-year-long economic downturn and a persistent income gap with the U.S. mainland contribute to an uncertain outlook for Puerto Rico. Still, the commonwealth possesses a skilled and educated workforce, a favorable business climate, and the benefits of U.S. legal and financial structures -...

The U.S. personal saving rate's negative turn in 2005 has raised concerns that Americans may have to curtail their spending and accept a lower standard of living as they pay off rising debts. However, a closer look at saving trends suggests that the risks to household well-being are overstated....

The sharp divergence in the 2001 recession between two key economic indicators-manufacturing production and goods output-could suggest that one indicator is flawed, casting doubt on the reliability of its overall series. This analysis finds no evidence of error. Rather, the strength of spending...

The steep drop in the U.S. personal saving rate over the last decade has fueled speculation that Americans are spending recklessly. But alternative measures of personal saving show that households are actually setting aside a larger share of their resources than the official figures suggest. In...

Critics of the consumer price index--the most widely watched inflation measure--contend that it overstates inflation by as much as 1 percentage point a year. Some have argued that alternative indexes eliminate the CPI's upward bias and offer a more accurate reading of inflation levels. A closer...

Analysts seeking evidence of rising inflation often focus on the movements of a single indicator_an increase in the price of gold, for example, or a decline in the unemployment rate. But simple statistical tests reveal that such indicators, used in isolation, have very limited predictive power.

Despite posting their strongest sustained performance in many years, recent measures of output and productivity growth have still fallen short of their 1960-73 averages. Could data-measurement problems affecting the pricing of some services account for the inability of these widely tracked U.S....