Mary: This is Mary Walden with economist MW welcoming you to the economic perspective. Today’s program asks, who calls a recession. Mike, the country is potentially heading into a recession – or actually may even be in a recession – caused by the coronavirus. How do we know a recession is occurring? Who or what makes that determination?
Mike: Summary Answer
- On a practical matter, people can tell there’s a recession – job loss or layoffs, people are pessimistic about the economy
- But a group – called the NBER – makes the call
- Private economics think tank around for over 100 years
- Look at depth and breadth of an economic contraction – job loss, spending reductions, falling revenues to businesses
- NBER wants to make sure reductions are significant, and are widespread across the economy
- Unfortunately, official call will often be made after the recession, because data are released with a considerable lag
- Today, will be significant drop – most economists think a recession is assured
- I’m MW
Mary: And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.