Policy Article

Estimating potential output and the output gap – An analysis of the EU approach and suggestions for improvement (in German)


  • Ademmer
  • M.
  • Boysen-Hogrefe
  • J.
  • Carstensen
  • K.
  • Hauber
  • P.
  • Jannsen
  • N.
  • Kooths
  • S.
  • Rossian
  • T.
  • Stolzenburg
  • U.
Publication Date

Measures of potential output and the output gap are of great importance for policy-makers who need to assess the cyclical position of the economy and its productive capacity. They play an essential role in the European Stability and Growth Pact and in the debt cap of the German constitution. This study analyzes the measures of potential output and the output gap derived from the European Commission’s estimation approach and suggests methodological improvements.


Key Words

  • European Commission
  • fiscal policy
  • Konjunktur
  • Output gap
  • potential output