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Accounting earnings and gross domestic product

Author

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  • Konchitchki, Yaniv
  • Patatoukas, Panos N.

Abstract

We document that aggregate accounting earnings growth is an incrementally significant leading indicator of growth in nominal Gross Domestic Product (GDP). Professional macro forecasters, however, do not fully incorporate the predictive content embedded in publicly available accounting earnings data. As a result, future nominal GDP growth forecast errors are predictable based on accounting earnings data that are available to professional macro forecasters in real time.

Suggested Citation

  • Konchitchki, Yaniv & Patatoukas, Panos N., 2014. "Accounting earnings and gross domestic product," Journal of Accounting and Economics, Elsevier, vol. 57(1), pages 76-88.
    • Handle: RePEc:eee:jaecon:v:57:y:2014:i:1:p:76-88
    DOI: 10.1016/j.jacceco.2013.10.001
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    More about this item

    Keywords

    Accounting earnings; Corporate profits; Gross Domestic Product (GDP);
    All these keywords.

    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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