Thursday, January 11, 2018

Earlier this week we introduced the concept of FROGs, where the abbreviation stands for Frivolously Related Output Gaps. This is a gap that is oddly small, even though growth has lagged for many years, because estimates of potential “bend” down almost as if to validate low GDP levels. In our minds, FROGs primarily reflect our poor ability to correctly measure potential. They can be dangerous because they validate the status quo even as it feeds populism.

IIF Authors

Robin Brooks

Robin
Brooks
Managing Director and Chief Economist
@RobinBrooksIIF
rbrooks@iif.com

Jonathan Fortun

Jonathan
Fortun
Associate Economist
@econchart
jfortun@iif.com

Gregory Basile

Gregory
Basile
Senior Research Analyst
@GregBasileIIF
gbasile@iif.com

Tariq Khan

Tariq
Khan
Research Analyst
+1 202 857 3339
tkhan@iif.com

Share