Related Readings:
December 1999
Oct 31, 2012
The Fed Explains Real Versus Potential GDP
By The Federal Reserve Bank of Atlanta Economic Education Department, Classroom Economist series, 2012.
The second in a series of videos on economic issues and the Federal Reserve focuses on gross domestic product, or GDP. Engaging graphics and straightforward examples help define total output and explain the difference between real and potential GDP.
Oct 31, 2012
What Is Potential GDP and Why Does It Matter?
By William T. Gavin, Federal Reserve Bank of St. Louis Economic Synopses, 2012, No. 11, April 20, 2012.
One look at recent Congressional Budget Office data shows how much estimates of the output gap can change as time passes.
Oct 31, 2012
Is the Output Gap a Faulty Gauge for Monetary Policy?
By Thomas Lubik and Stephen Slivinski, Federal Reserve Bank of Richmond Economic Brief EB10-01, January 2010.
Okun’s law describes one of the most famous empirical relationships in macroeconomics. Proposed by economist Arthur Okun in 1962, it basically states that if GDP grows rapidly the unemployment rate declines, if growth is very low or negative the unemployment rate rises, and if growth equals potential the unemployment rate remains unchanged.
