Example research essay topic: Wall Street Journal Gross Domestic Product - 1,784 words

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... that things are going to be that rosy, said David Wyss, chief economist at Standard & Poors, after Fridays G. D. P.

report. The biggest drags on the economy last quarter were exports, retail sales, equipment and software, and housing. The revision could be traced primarily to a contraction in inventories of unsold goods, which the government had previously said had grown. The trade gap was wider than had been reported, with fewer American goods bought abroad.

Exports fell at an annualized rate of 23. 6 percent last quarter. Some hailed the inventory decline as potentially good news. The only plus to take out of this is that inventories werent as high, and that implies you dont have to cut as much this quarter to get them back under control, said Nigel Gault, of IHS Global Insight. Inventories remain too large, given the declines in consumer spending, he said, adding that companies will have to cut production further this quarter. In past recessions, inventories have declined much more than in the last quarter, said Robert Barbera, chief economist at ITG. In terms of inventory drawdown, we aint seen nothing yet, he said.

Historically, in a tough recession, inventories fall at four or five times the pace of the fourth-quarter decline. A distressing aspect of the report was the lack of business investment, said Joseph Brussels, a director at Moody's Economy. com. Investment in equipment and software fell at an annualized rate of 28. 8 percent. Were not going to have a consumer-led recovery, he said.

He predicted it will be led by the technology industry and businesses spending on capital investments, which makes Fridays figures for capital expenditures look somewhat troubling. Some economists said the price revision was the reports biggest surprise. Prices fell, but slightly less than reported earlier. On an inflation-adjusted basis, that means consumers spent even less than earlier believed. According to a report released Friday from Reuters and the University of Michigan, an index of consumer confidence fell for the first time in three months, to 56. 3, from 61. 2 in January. The final revision in output for the quarter will come from the Bureau of Economic Analysis next month.

Robin Kwong (2009) Taiwan GDP slumps 8 % as export demand falls The Financial Times Taiwan has tumbled into recession, suffering a record annual fall in output at the end of last year to become east Asia's worst-performing economy. Official data on Wednesday showed Taiwan's gross domestic product shrank 8. 36 per cent year-on-year in the last quarter of 2008, a bigger drop than analysts had expected and that underscored the exposure of Asian exporters to the slump in world demand. The figures spurred the Taiwanese central bank to make an unexpected 0. 25 percentage point cut in interest rates, bringing its key interest rate to a record low of 1. 25 per cent. The economy has contracted for two straight quarters, meeting a common definition of recession.

Yen Thing-ta, the banks top economist, said that by cutting rates, we want to send a signal: the central bank will maintain a loose money policy. Taiwan's woes spell further gloom for other economies in the region, particularly that of China, where Taiwanese manufacturers have shifted much of their output in recent years and where many of the islands manufactured electronics parts are shipped for final assembly before being sold to consumers in the west. According to the International Labour Organisation, Asia will see the number of jobless people rise by up to 23. 3 m in 2009, three times more than the estimate of 7. 2 m last month as the region reels from the recession in the worlds richest countries. Taiwanese officials said that its economy, Asia's sixth biggest, would deteriorate further throughout the first half of this year. They forecast a contraction of nearly 3 per cent in 2009 after earlier projecting growth of more than 2 per cent. Exports are expected to drop by a fifth this year, with consumer prices projected to fall sharply too.

There is little hope of returning to positive economic growth until the fourth quarter of this year, said Tsai Hung-kun, of the national statistics agency. While suggesting that exports would begin to rebound at the year end, he said the government had underestimated the degree to which exports suffered when it predicted three months ago that the economy would grow by more than 2 per cent this year. Taiwan is particularly affected by the global economic climate because of [its] concentration in export products, the central bank said. The latest figures heap pressure on President Ma Ying-jeou, who was elected on a platform of economic growth last year but whose popularity has fallen. The government has already announced a T$ 500 bn (US$ 14. 4 bn), two-year stimulus package, which includes infrastructure projects, measures to boost employment and hand-outs of T$ 85 bn in consumer vouchers. Mr Tsai said the government spending would boost GDP by 2. 77 per cent this year.

But economists doubted the extent to which the measures would help the economy and said Taiwan remained vulnerable to weak global demand. [The measures] will help but not significantly because they are not of a big enough scale, said Cheng Cheng-mount, chief economist at Citibank in Taipei. There is still a lot of room for further government spending, as Taiwan's debt-to-GDP ratio is only around 30 per cent. Sudeep Reddy (2008) The GDP Debate: Did a Recession Start in 2007? The Wall Street Journal The government today released its annual revisions to GDP data for the past three years.

And among the changes is this turnabout: The economy contracted slightly in the fourth quarter of 2007. The Bureau of Economic Analysis now says gross domestic product declined 0. 2 % in the final three months of the year. The previous estimate was an increase of 0. 6 %. The BEA revised GDP downward for all three years (2005 to 2007), lowering the overall 2007 growth rate to 2 % from 2. 2 % and the 2004 - 2007 average annual growth rate to 2. 6 % from 2. 7 %.

Every quarter in 2007 was revised, but the moves only reinforce how much growth followed the sawtooth pattern throughout the year. The first quarter of last year showed a GDP gain of just 0. 1 % (previously reported as 0. 6 %), while the second quarter was revised a full percentage point to 4. 8 % (from 3. 8 %) and the third quarter moved down slightly to 4. 8 % (from 4. 9 %). Could the decline in GDP in the fourth quarter of 2007 mark the beginning of a recession? Certainly not yet by the most common definition that calls for two straight quarters of declining GDP. The economy grew 0. 9 % in the first quarter of this year, though of course that figure could be revised down the road. The prior two quarters showed robust growth, perhaps leading to a payback in the final three months of the year.

But the National Bureau of Economic Research's Business Cycle Dating Committee, the nations arbiter of recessions, has enough latitude to make the call. GDP is among five key indicators the committee follows to determine a recession, which it defines as a significant decline in economic activity spread across the economy, lasting more than a few months. Among the measures other than GDP, only retail / wholesale sales started a decline in the fourth quarter of the year. Overall employment peaked in December and started declining in January, perhaps giving the committee more room to date the recession back to December when private-sector payrolls started dropping but were offset by government jobs. The other two measures are personal income and industrial production. (See which ones have peaked with this Wall Street Journal graphic. ) In dating the 2001 recession, committee members debated whether to put more attention on GDP, as a measure of overall economic output, or employment, as measure of how the economy's resources were being deployed. GDP ultimately prevailed. (See Mondays coverage in the Journal and Real Time Economics for how members are weighing the the debate over the importance of a GDP decline in making a recession call. ) But the NBER committee aims to identify a particular month when the economy went from expansion to contraction.

That led the committee members to pinpoint the recession to March 2001, when employment started declining. This time, most members will be hesitant to put too much weight in the slight contraction reported for the end of 2007 if the job market wasnt in decline then as well. But some are especially resistant to declaring a recession without a single GDP decline, which they now have. And then theres the potential for more revisions. The fourth-quarter GDP decline of 0. 2 % will stand on the books until July 2009, when the BEA does its next round of annual revisions. (The revisions are made based on new and better source data than the original figures. ) GDP in the first quarter of this year also could be revised downward closer to zero at the time. Of course, more GDP declines could show before then: some forecasts expect the economy to contract in the fourth quarter of this year and first quarter of 2009.

Sudeep Reddy The economist (2008) Grossly distorted picture The Economist Which economy has enjoyed the best economic performance over the past five years: America's or Japan's? Most people will pick America. The popular perception is that America's vibrant economy was sprinting ahead (albeit fuelled by credit and housing bubbles that have now painfully burst), whereas Japan crawled along at a snail's pace. And it is true that America's average annual real GDP growth of 2. 9 % was much faster than Japan's 2. 1 %. However, the single best gauge of economic performance is not growth in GDP, but GDP per person, which is a rough guide to average living standards. It tells a completely different story.

GDP growth figures flatter America's relative performance, because its population is rising much faster, by 1 % a year, thanks to immigration and a higher birth rate. In contrast, the number of Japanese citizens has been shrinking since 2005. Once you take account of this, Japan's GDP per head increased at an annual rate of 2. 1 % in the five years to 2007, slightly faster than America's 1. 9 % and much better than Germany's 1. 4 %. In other words, contrary to the popular pessimism about Japan's economy, it has actually enjoyed the biggest gain in average income among the big three rich economies.

Research essay sample on Wall Street Journal Gross Domestic Product