National bureau of economic research business cycle dating committee
International experiences of business cycle dating committees The NBER’s BCDC maintains a chronology of the US business cycle.
NBER is a private, non-profit, non-partisan organization conducting economic research and regarded as authoritative by both academic researchers and the public at large.
Currently, India relies mostly on individual studies for the dating of business cycles. The working group proposed a standing committee for business cycle analysis.
The Reserve Bank of India (RBI) set up a working group of economic indicators in 2002 and a technical advisory group (TAG) on the development of leading indicators for the Indian economy in 2006, both under the chairmanship of R. Its job was the same as a BCDC, i.e., maintaining historical dating of business cycles.
For the euro area, it is the Centre for Economic Policy Research (CEPR) which does this job.
Like the NBER, CEPR is also an independent, non-profit organization.
It was founded in 2005 and replicates the experience of the NBER BCDC and CEPR. By maintaining a chronology of business cycles, India will be able to better monitor the economy.
This group reviews a variety of economic statistics and indicators of U. economic conditions before deciding on the turning points in the economy—business cycle peaks and troughs—that define periods of recessions and expansions. Official Recessions and Expansions The NBER web site describes a recession and the types of economy-wide economic data used to identify a recession in the U. economy as follows: A recession is a significant decline in activity spread across the economy, lasting more than a few months, visible in industrial production, employment, real income, and wholesale-retail trade.
It analyses and compares the behaviour of key macroeconomic variables such as consumption, investment, unemployment, money supply, inflation, stock prices, etc., which may have different dynamics before, during and after the recession.
It identifies turning points which act as a reference point for the construction of coincident, leading and lagging indicators of the economy.
This will also help India to be more in synchronization with the other developed and emerging market economies.
Mayank Gupta is a research scholar at the department of economics (autonomous), University of Mumbai.
Most of the research in business cycles is done keeping in mind advanced industrial economies.