Wisconsin state-level GDP data was released last week. Here’s a picture of the series, compared to the Evers administration’s projections and the naive projections based on US GDP and lagged WI GDP.
figure 1: June 30 Wisconsin GDP (blue), May economic outlook forecast (sky blue squares) and forecast based on first difference of US GDP over the same period, lagged Wisconsin GDP (see Discussion), and 6/30 GDPNow Live predict.Source: BEA, and Wisconsin Economic Outlook (possible) and the authors’ calculations.
as pointed out in this article postalthe government’s forecast is based on the SPGMI (nee IHS Markit) forecast for the US, which includes a period of slightly negative growth.
The red dotted line represents the forecast/live forecast of WI GDP using the following relationship covering Q2 2021 to Q1 2023 (quarterly data).
D.the yWisconsint = -0.004 +1.01D.the yust + 0.37D.the yWisconsint-1 + yout
adjust-R2 = 0.84, NOb = 8, SER = 0.0028, DW = 2.06. black body Indicates significance at 5% MSL using the HAC robust standard error.
While real GDP is rising, its growth has lagged that of the nation and the (BEA) Great Lakes region since the fourth quarter of 2022. It also lags the growth rate of Minnesota, which has a Democratic governor and legislature.
figure 2: Wisconsin GDP (black), Minnesota GDP (blue), Great Lakes GDP (green), US GDP (red). US GDP Watch for Q2 2023 Atlanta Fed GDPNow (6/30). Sources: BEA, Atlanta Fed, and authors’ calculations.
