News or Noise? An Analysis of GNP Revisions

N. Gregory Mankiw, Matthew D. Shapiro

NBER Working Paper No. 1939 (Also Reprint No. r0778)
Issued in November 1986
NBER Program(s):   EFG

This paper studies the nature of the errors in preliminary GNP data,

It first documents that these errors are large. For example, suppose the

prelimimary estimate indicates that real GNP did not change over the

recent quarter; then one can be only 80 percent confident that the final

estimate (annual rate) will be in the range from -2.8 percent to +2.8

percent. The paper also documents that the revisions in GNP data are not

forecastable, This finding implies that the preliminary estimates are the

efficient given available information. Hence, the Bureau of Economic

Analysis appears to follow efficient statistical procedures, in making its

preliminary estimates.

(251 K)

(183 K)

Published: Mankiw, N. Gregory and Matthew D. Shapiro."News or Noise? Analysis of GNP Revisions," Survey of Current Business, Vol. 66, pp. 20-25, May 1986.

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