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Lagging indicators are indicators that usually change after the economy as a whole does. Typically the lag is a few quarters of a year. The unemployment rate is a lagging indicator: employment tends to increase two or three quarters after an upturn in the general economy. [citation needed]. In a performance measuring system, profit earned by a ...
Economists, analysts, policymakers and investors take the economy's temperature by examining regularly released data sets called economic indicators. There are all kinds of economic indicators ...
A lead–lag effect, especially in economics, describes the situation where one (leading) variable is cross-correlated with the values of another (lagging) variable at later times. [citation needed] In nature and climate, bigger systems often display more pronounced lag effects.
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Continue reading ->The post Understanding Lagging and Leading Indicators appeared first on SmartAsset Blog. There's also an old joke that economists have predicted nine of the last five recessions.
An 'indicator' can only measure what 'has' happened, in the past tense, so the only type of measurement is descriptive or lagging. Any KPI that attempts to measure something in a future state as predictive, diagnostic or prescriptive is no longer an 'indicator', it is a 'prognosticator' – at this point, it is analytics (possibly based on a ...
Leading indicators are readily measurable and provide organizations with an early warning when something isn't going right so they can course-correct. Conversely, lagging indicators are those metrics which can't be attributed to particular changes and so prevent organizations from course-correcting in time.
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