[{"data":1,"prerenderedAt":63},["ShallowReactive",2],{"term:output-gap":3},{"term":4,"related":46},{"id":5,"title":6,"body":7,"category":27,"description":28,"extension":29,"faq":30,"meta":31,"navigation":32,"path":33,"related":34,"seo":39,"stem":40,"takeaways":41,"__hash__":45},"terms\u002Fterms\u002Foutput-gap.md","Output Gap",{"type":8,"value":9,"toc":22},"minimark",[10,15,19],[11,12,14],"h2",{"id":13},"understanding-output-gap","Understanding Output Gap",[16,17,18],"p",{},"Potential GDP is what the economy can produce when it uses its labor and capital at sustainable rates. A negative gap means slack and high unemployment; a positive gap means the economy is overheating, which tends to push inflation up.",[16,20,21],{},"Potential output is estimated, not observed, which makes the gap uncertain in real time.",{"title":23,"searchDepth":24,"depth":24,"links":25},"",2,[26],{"id":13,"depth":24,"text":14},"economy","The difference between actual GDP and potential GDP.","md",[],{},true,"\u002Fterms\u002Foutput-gap",[35,36,37,38],"natural-rate-of-unemployment","okuns-law","taylor-rule","real-gdp",{"title":6,"description":28},"terms\u002Foutput-gap",[42,43,44],"Output gap = actual GDP − potential GDP, often as a percent of potential.","Negative gaps mean slack; positive gaps mean overheating.","It guides monetary policy, for example in the Taylor rule.","ikd8yiuJxBK0X4ApfbaYrGWzg_fndqzUlupaBXBndyI",[47,51,55,59],{"title":48,"description":49,"path":50},"Natural Rate of Unemployment","The unemployment rate that persists when the economy is at full strength, also called the NAIRU.","\u002Fterms\u002Fnatural-rate-of-unemployment",{"title":52,"description":53,"path":54},"Okun's Law","A rule of thumb linking unemployment to the gap between actual and potential output.","\u002Fterms\u002Fokuns-law",{"title":56,"description":57,"path":58},"Real GDP","GDP measured at constant prices, so it changes only when the quantity of output changes.","\u002Fterms\u002Freal-gdp",{"title":60,"description":61,"path":62},"Taylor Rule","A formula suggesting where a central bank should set interest rates based on inflation and the output gap.","\u002Fterms\u002Ftaylor-rule",1793374005602]