NBER

Definition

The National Bureau of Economic Research (NBER) is a private, non-profit organization that conducts economic research and analysis. It is recognized as one of the leading authorities on identifying and studying business cycles and economic activity in the United States.

5 Must Know Facts For Your Next Test

1. The NBER is responsible for officially declaring the beginning and end of recessions in the United States.
2. The NBER uses a variety of economic indicators, including GDP, employment, industrial production, and personal income, to determine the peaks and troughs of the business cycle.
3. The NBER's determination of the business cycle is based on the overall condition of the economy, not just a single indicator.
4. The NBER's business cycle dating committee meets regularly to analyze economic data and make decisions about the state of the business cycle.
5. The NBER's business cycle research is widely used by policymakers, businesses, and academics to understand and respond to economic fluctuations.

Review Questions

• Explain the role of the NBER in identifying and studying business cycles.
  • The NBER is a private, non-profit organization that is widely recognized as the authority on identifying and studying business cycles in the United States. The NBER uses a variety of economic indicators, such as GDP, employment, and industrial production, to determine the peaks and troughs of the business cycle. The NBER's business cycle dating committee meets regularly to analyze economic data and make decisions about the state of the business cycle, which is then used by policymakers, businesses, and academics to understand and respond to economic fluctuations.
• Describe how the NBER's determination of the business cycle differs from using a single economic indicator.
  • The NBER's determination of the business cycle is based on the overall condition of the economy, not just a single indicator. This is important because the economy can experience fluctuations in different sectors at different times, and relying on a single indicator may not capture the full picture. By using a variety of economic indicators, the NBER is able to get a more comprehensive understanding of the state of the economy and make more accurate determinations about the business cycle.
• Analyze the significance of the NBER's role in the context of business cycles and economic activity.
  • The NBER's role in identifying and studying business cycles is highly significant because it provides a framework for understanding and responding to economic fluctuations. The NBER's determinations of the peaks and troughs of the business cycle are widely used by policymakers, businesses, and academics to inform their decision-making and strategies. By providing a consistent and authoritative analysis of the state of the economy, the NBER helps to reduce uncertainty and promote economic stability. Additionally, the NBER's research on the factors that drive business cycles can inform policy decisions and help to mitigate the negative impacts of economic downturns.

Related terms

Business Cycle: The periodic fluctuations in economic activity, measured by indicators such as GDP, employment, and industrial production, over a period of time.

Recession: A significant decline in economic activity spread across the economy, lasting more than a few months, and visible in industrial production, employment, real income, and wholesale-retail trade.

Economic Indicators: Statistics that provide information about the state of the economy, such as GDP, unemployment rate, inflation, and consumer confidence.