Scoring the leading indicators
Article Abstract:
The ability of the composite index of leading indicators to predict the turning points of business cycles is analyzed. A Bayesian sequential probability recursion is used to generate turning-point probabilities from the leading index. The turning-point probabilities are then analyzed using formal probability-assessment scoring rules. Results show that the leading indicators should be specialized during contractions for the prediction of troughs and specialized during expansions for the predictions of peaks.
Publication Name: The Journal of Business
Subject: Business, general
ISSN: 0021-9398
Year: 1989
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Estimation of the economic rate of return for industrial companies
Article Abstract:
A method for estimating the real economic rate of return for large industrial companies is developed. Research results show that the economic rate of return and the accounting rate of returns often differ by a wide margin. Results also show that the inflation-adjusted economic rate of return for most companies has been declining over the past two decades.
Publication Name: The Journal of Business
Subject: Business, general
ISSN: 0021-9398
Year: 1989
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