About a Coincident Index for the State of the Economy
La serie Borradores de Economía es una publicación de la Subgerencia de Estudios Económicos del Banco de la República. Los trabajos son de carácter provisional, las opiniones y posibles errores son responsabilidad exclusiva del autor y sus contenidos no comprometen al Banco de la República ni a su Junta Directiva.
The construction of coincident indexes for the economic activity of a country is a common practice since the fifties. The methodologies vary from heuristic methods to probabilistic or statistical ones. In this paper, we present a new procedure for estimating a coincident index of the state of the economy which is optimum in a statistical sense. This procedure is based on state space models that do possess the steady-state property. We apply our methodology for computing a coincident index for the Colombian economy. Key words: State of the economy, Coincident Index, State Space Models.
