Potential Output and Output Gap in Central America, Panama and Dominican Republic
IMF Working Papers, June 12, 2013
Source details
- Canonical URL
- Potential Output and Output Gap in Central America, Panama and Dominican Republic
Other formats
Bibliographic details
- Authors: Christian A Johnson
- Published: June 12, 2013
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484322208.001
Overview and Purpose
- Potential Output is a key factor for debt sustaintability analysis and for developing strategies for growth.
- Potential Output is an unobservable variable; this paper estimates it for CAPDR countries using annual data.
- Methodologies used: production function, switching, and state-space.
Main Findings
- CAPDR potential growth is about 4.4 percent while output gap volatility is about 1.9 percent.
- The highest-potential growth country is Panama (6.5 percent) while the lowest-growth country is El Salvador (2.6 percent).
- CAPDR business cycle is about eigth years.
Analytical Focus and Measures
- Emphasis on estimating potential output and the potential output gap.
- Key subject areas: Economic growth, Output gap, Potential output, Production, Production growth, Sustainable growth, Total factor productivity.
- Keywords used in analysis include: CAPDR country, Central America, growth decomposition, output gap variability, output gap-production function approach, Potential growth, Production growth, standard deviation, state-space model, switching, Total factor productivity.
Policy Relevance
- Accurate estimates of potential output inform debt sustainability analysis.
- Estimates support development of strategies for growth and assessment of cyclical conditions across CAPDR countries.
IMF Working Paper by Christian A Johnson, June 12, 2013 — Potential Output and Output Gap in Central America, Panama and Dominican Republic
Content in this bundle
- _wp13145 - References