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Why is GDP typically revised upwards?

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  • Philip Hans Franses

Abstract

Quarterly and annual gross domestic output (GDP) data are usually revised, and this revision process may cover a few years. It is also usually found that GDP figures are revised upwards. In this note, I provide a simple explanation for why this happens. Implications for interpreting and forecasting GDP data are less simple.

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  • Philip Hans Franses, 2009. "Why is GDP typically revised upwards?," Statistica Neerlandica, Netherlands Society for Statistics and Operations Research, vol. 63(2), pages 125-130, May.
    • Handle: RePEc:bla:stanee:v:63:y:2009:i:2:p:125-130
    DOI: 10.1111/j.1467-9574.2008.00410.x
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    References listed on IDEAS

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    1. S. Borağan Aruoba, 2008. "Data Revisions Are Not Well Behaved," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 40(2‐3), pages 319-340, March.
    2. Swanson, Norman R. & van Dijk, Dick, 2006. "Are Statistical Reporting Agencies Getting It Right? Data Rationality and Business Cycle Asymmetry," Journal of Business & Economic Statistics, American Statistical Association, vol. 24, pages 24-42, January.
    3. Faust, Jon & Rogers, John H & Wright, Jonathan H, 2005. "News and Noise in G-7 GDP Announcements," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 37(3), pages 403-419, June.
    4. Corradi, Valentina & Fernandez, Andres & Swanson, Norman R., 2009. "Information in the Revision Process of Real-Time Datasets," Journal of Business & Economic Statistics, American Statistical Association, vol. 27(4), pages 455-467.
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    Cited by:

    1. Franses, Philip Hans, 2013. "Data revisions and periodic properties of macroeconomic data," Economics Letters, Elsevier, vol. 120(2), pages 139-141.
    2. Henk Kranendonk & Johan Verbruggen, 2009. "Reaction to Philip Hans Franses’ Note ‘Why is GDP typically revised upwards?’," Statistica Neerlandica, Netherlands Society for Statistics and Operations Research, vol. 63(2), pages 133-134, May.
    3. Semieniuk, Gregor, 2024. "Inconsistent definitions of GDP: Implications for estimates of decoupling," Ecological Economics, Elsevier, vol. 215(C).

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