Improving GDP Measurement: A Measurement Error Perspective
We provide a new measure of historical U.S. GDP growth, obtained by applying optimal signal-extraction techniques to the noisy expenditure-side and income-side GDP estimates. The quarter-by-quarter values of our new measure often differ noticeably from those of the traditional measures. Its dynamic properties differ as well, indicating that the persistence of aggregate output dynamics is stronger than previously thought.
Find the Philadelphia Fed product based on this paper at: https://www.philadelphiafed.org/research-and-data/real-time-center/gdpplus.