U.S. Study Claims Conception Rates Can Predict An Economic Recession

In a period of several months before a recession, there is a fall in the overall rates of women getting according to an academic research done in the US.

Economic downturns and recessions can be helped to be predicted by the rates of fertility, said the authors of the study.

The authors further claimed that their study is more accurate compared to some of the other traditional indicators.

Just before the beginning of the last three recessions that hit the United States, the researchers noted first a halt in the increase of rate of conceptions and then marking a sharp reduction, shows the research.

Often there are criticisms of economists that they are mostly not able to provide directions of economic growth accurately. And this has driven many to look at other forms of indications apart from the traditional ones like the housing prices, manufacturing output and retail spending and are attempting to create a better, more accurate and complex visual on the short term economic future.

“We think that the factors behind the last three recessions also had a profound and rapid effect on fertility decisions,” the report’s authors said, summarising their findings.

“In fact, these factors seem to have impacted fertility decisions before large parts of the economy.”

Over 100 million births in the United States between 1989 and 2016 were tracked by the researchers of the study that is titled ‘Is Fertility a Leading Economic Indicator’. Data about miscarriages and abortions were also accommodated in the results.

While multiple previous researches have already established that in a downturn, there is a drop in birth rates, researchers Daniel Hungerman, Kasey Buckles and Steven Lugauer in their research have concluded that in a number of months preceding a recession, a significant drop in the rates of conception can be seen.

“We were surprised when we saw [the correlation] and then we were surprised no one had noticed it before,” said Mr Hungerman.

Before the setting of a recession, the rate of conception first grew at a slow rate and then there is a steep fall in the rates of conception as a recession nears. This process can be observed several quarters before the recession.

“The nature of each recession has differed and so what conversation goes on at the kitchen table might be different, but I do think that people talk about the future when they try to have a baby and in aggregate they seem to do a good job thinking about it,” says Mr Hungerman.

For example, the research says that business leaders polled in December 2007 appeared to be optimistic about the future of the global economy even though it was later found out that by the recession had already set in. The research also noted that by that time. There had already been a decline in the rates of conception where the beginning of the fall in rates of conception was a number of quarters prior to the collapse of Bear Stearns and Lehman Brothers.

“The huge amount of data is important,” said Mr Hungerman.

“Even more important is the frequency. Most studies use annual level data but with ours we look within the year.

“For a lot of the anticipatory patterns we see they’re measured in quarters or months. If you use annual level data you might miss that.”

(Adapted from BBC.com)


Categories: Creativity, Economy & Finance, Strategy, Uncategorized

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