Accounting earnings and gross domestic product
Published Web Locationhttps://doi.org/10.1016/j.jacceco.2013.10.001
We document that aggregate accounting earnings growth is an incrementally significant leading indicator of growth in nominal Gross Domestic Product (GDP). Professional macro forecasters, however, do not fully incorporate the predictive content embedded in publicly available accounting earnings data. As a result, future nominal GDP growth forecast errors are predictable based on accounting earnings data that are available to professional macro forecasters in real time. © 2013 The Authors.