The Shape of Things to Come

Economic recoveries from the past two recessions have been much more gradual than the rapid V-shaped recoveries typical of earlier downturns. Analysis of the factors that determine economic growth rates indicates that recovery from the most recent recession is likely to be faster than from the two previous recessions, but slower than earlier V-shaped recoveries.

Figure 1
Real GDP growth including August 2009 forecasts

Note: LW refers to Laubach and Williams (2003).

Figure 2
Real GDP growth including May 2010 forecasts

Note: LW refers to Laubach and Williams (2003).

http://www.frbsf.org/publications/economics/letter/2010/el2010-15.html

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