This paper deals with the estimation of the output gap. We use uni- and bivariate unobserved components models in order to decompose the observed German GDP-series into trend, cycle and seasonal components. The results show that using the ifo business assessment variable as an indicator for the...

This paper deals with the estimation of the output gap. We use uni- and bivariate unobserved components models in order to decompose the observed German GDP-series into trend, cycle and seasonal components. The results show that using the ifo business assessment variable as an indicator for the...

This paper compares the German Gross Domestic Product between 1991 and 2008 with the Ifo business indicators. Because GDP is published quarterly but the Ifo indicators monthly, the most analyses compare these variables by merging the indicators to quarterly data. In this paper an alternative way...

Extending earlier research on forecasting recessions with financial variables, I examine the importance of additional financial variables and temporal dependence for recession prediction. I show that both additional financial variables, in particular, the Treasury bill spread, default yield...