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Output Gap |
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Output Gap The difference between an economy's GDP and its potential GDP. That is, the output gap measures GDP against what the GDP ought to be if the economy were using its resources efficiently. A positive output gap occurs when the GDP exceeds the efficient GDP, usually through the over-utilization of resources, while a negative output gap occurs when the GDP undershoots the potential GDP. Most analysts believe that a positive output gap leads to inflation. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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