Title:

Seek and Ye Shall Not Find : The Absence of Hysteresis in U.S. Macroeconomic Data , No. 21-04

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Seek and Ye Shall Not Find : The Absence of Hysteresis in U.S. Macroeconomic Data , No. 21-04

DATE: February 2021

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ABSTRACT: Economists are keenly interested in longer-run economic phenomena that interact with short-run shocks and business cycles. A particularly well-known example is hysteresis, which posits that disturbances typically thought of as transitory actually can have permanent effects. While this concept is well-recognized in theoretical modeling, empirical evidence has been sparse. After conducting a thorough analysis of U.S. macroeconomic data, we conclude that there has been no hysteresis in the United States for the past 60 years.



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Benati, Luca , Lubik, Thomas A. and Federal Reserve Bank of Richmond. "Seek and Ye Shall Not Find : The Absence of Hysteresis in U.S. Macroeconomic Data , No. 21-04," Economic Brief (February 2021). https://fraser.stlouisfed.org/title/6034/item/600382, accessed on April 16, 2024.

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