Large Mac Nation and Recession since 2022

In a latest paper, Antoni and St. Onge (2024) have argued that the height in GDP, correctly measured, was in 2021Q4.

Supply: Antoni and St. Onge (2024).

As famous on this submit, I can’t — regardless of my finest efforts — replicate their outcomes (whereby they declare the suitable deflator for GDP is up 40% as a substitute of BEA reported 21.1%, sine 2019Q1). Nevertheless, if all we produced and consumed (by households, companies, the federal government, and foreigners) was Large Mac^TM‘s, then one may argue that we’ve got been in recession since 2022 (however are simply popping out in 2024Q2).

Determine 1: US GDP expressed in Large Macs (brown, left log scale), and in bn.Ch.2017$ (black, proper log scale), each SAAR. NBER outlined peak-to-trough recession dates shaded grey. Large Mac costs interpolated linearly from semi-annual reported costs. Supply: BEA 2024Q2 third launch/annual replace, Economist, NBER, and creator’s calculations. 

Notice that Antoni and St. Onge don’t present a spreadsheet of calculations to indicate how they obtained their 40% improve in deflator.