Prosperity and Depression by Gottfried Haberler

Author:Gottfried Haberler [Gottfried Haberler]
Language: eng
Format: epub, pdf
ISBN: 978-1-61016-172-5
Publisher: United Nations Lake Success
Published: 1946-11-06T16:00:00+00:00

Various indices recording the cycle.

In the preceding graphs, the cyclical movement in a number of countries is represented by various indices, a description of which is given in Appendix I. An inspection of the diagrams shows an, almost perfect concordance in the movements of different curves. There are sometimes slight deviations; out they seldom exceed one year. They can often be explained by inaccuracies in the figures or in the description in the annals. The conventions which have been adopted for the graphical representation of the “Annals” must be kept in mind, if a misleading impression is to be avoided. Only a few gradations of prosperity and depression are distinguished, so that neither the amplitude of fluctuations nor the speed of recovery and decline at various points can be adequately indicated. Both the high and the low conjunctures tend to be represented by horizontal straight lines masking the tarning-points which come either in the latter part of the last year of the horizontal or in the first part of the following year.

It must also be remembered that, whereas the production indices show a pronounced trend movement, on which the cyclical fluctuations are superimposed, in the employment series—except in the case of the United States of America—and the Reference Cycle Curve, the trend is eliminated by the method of their construction.

These curves represent the business cycle in the general sense—that is to say, they record the changes in production and employment irrespective of the cause. But there is no doubt that, with a very few exceptions, the ups and downs of production in our curves are not the direct effect of material obstructions to the production process caused by strikes, earthquakes, etc. The direct influence of the weather on the volume of agricultural production plays no rôle, since our production and employment figures relate to industry alone.

Since reliable direct measurements of our fundamental criteria—employment and volume of production—are not always available, it is necessary to have recourse to other statistical series, which are either themselves constituent parts of the index of production, or are empirically so closely related that they can be taken as highly symptomatic for the direction of the movement or magnitude of fluctuations in the fundamental variable. Such “auxiliary” or “symptomatic” series, as they may be called, are bank clearings, bank deposits, other monetary series, price series, transportation figures, bankruptcies, etc.

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