ABSTRACT
This chapter explains how to measure business cycles in a systematic and clear manner. It defines the business cycle, and explains how to find the peaks and troughs of the business cycle. The chapter also explains how to measure the path of any economic series over the cycle, and shows how to apply these measurements to production and to unemployment. The main tools for careful measurement of the instability caused by the business cycle were developed by Wesley Clair Mitchell. The business cycle is defined as recurrent periods in which there are expansions in most economic activities, followed by contractions in most economic activities. The National Bureau of Economic Research (NBER) describes its Business Cycle Dating Committee: the NBER's Business Cycle Dating Committee maintains a chronology of the US business cycle. The gross domestic product measures the dollar value of all goods and services produced within the US borders.
