Measuring global economic activity

Summary A number of economic studies have used a proxy for world real economic activity derived from shipping costs. This measure turns out to depend on a normalization that has substantive consequences, of which users of the index had been unaware prior to this paper. This paper further evaluates t...

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Bibliographic Details
Published inJournal of applied econometrics (Chichester, England) Vol. 36; no. 3; pp. 293 - 303
Main Author Hamilton, James D.
Format Journal Article
LanguageEnglish
Published Chichester Wiley Periodicals Inc 01.04.2021
Subjects
Coherence
Commodity prices
Econometrics
Economic activity
Economic conditions
Economics
Industrial production
Normalization
Pricing
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Summary:Summary A number of economic studies have used a proxy for world real economic activity derived from shipping costs. This measure turns out to depend on a normalization that has substantive consequences, of which users of the index had been unaware prior to this paper. This paper further evaluates this and alternative measures in terms of treatment of trends, coherence with world output, and correlation with commodity prices. I conclude that measures derived from world industrial production offer a better indicator of global real economic activity.
ISSN:0883-7252
1099-1255
DOI:10.1002/jae.2740