Vadim Khramov y John
Ridings Lee publicaron The Economic Performance Index (EPI): an Intuitive Indicator for Assessing a Country's Economic Performance. Dynamics in an Historical Perspective. Buscan elaborar un índice consolidado para medir la performance económica de una región geográfica. El abstract apunta: "Existing economic indicators and indexes assess
economic activity but no single indicator measures the general macro-economic
performance of a nation, state, or region in a methodologically simple and
intuitive way. This paper proposes a simple, yet informative metric called the
Economic Performance Index (EPI). The EPI represents a step toward clarity, by
combining data on inflation, unemployment, government deficit, and GDP growth
into a single indicator. In contrast to other indexes, the EPI does not use
complicated mathematical procedures but was designed for simplicity, making it
easier for professionals and laypeople alike to understand and apply to the
economy. To maximize ease of understanding, we adopt a descriptive grading
system. In addition to a Raw EPI that gives equal weights to its components, we
construct a Weighted EPI and show that both indexes perform similarly for U.S.
data. To demonstrate the validity of the EPI, we conduct a review of U.S.
history from 1790 to 2012. We show that the EPI reflects the major events in
U.S. history, including wars, periods of economic prosperity and booms, along
with economic depressions, recessions, and even panics. Furthermore, the EPI
not only captures official recessions over the past century but also allows for
measuring and comparing their relative severity. Even though the EPI is simple
by its construction, we show that its dynamics are similar to those of the
Chicago Fed National Activity Index (CFNAI) and The Conference Board Coincident
Economic Index® (CEI)."
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