Sunday, April 28, 2019

Components of Aggregate Demand

Spain GDP (USD, Billions). 1996-2016



Consumer Confidence vs. GDP
Consumer Spending vs. GDP
Business Confidence vs. GDP
Government Spending vs. GDP
Balance of Trade vs. GDP


Some indicators, such as balance of trade, consumer confidence, and business confidence don't correlate strongly with changes in GDP, but indicators such as government spending and consumer spending track extremely closely, almost matching their shifts exactly. It seems that spending in general has a substantial impact on GDP (or GDP has a substantial impact on spending). 

1 comment:

  1. You haven't answered the question: "In what ways do changes in these indicators help to explain changes in GDP?"

    ReplyDelete

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