Leading economic indicators: The World Competitiveness Yearbook and leading economic indicators
Leading economic indicators are country statistics that change before the economy moves toward particular patterns. Leading economic indicators thus have the potential to be used to predict future economic trends. Leading economic indicators include statistics on stock market, manufacturing activity, inventory levels, retail sales, building permits, housing market, level of new business start-ups, among others. The IMD World Competitiveness Center's World Competitiveness Yearbook incorporates several leading economic indicators.
The Yearbook includes leading economic indicators(referred to as "hard data" or "hard statistics") as components of the different factors that assess competitiveness. There are several stock market-related leading economic indicators as part of the Business Efficiency factor of competitiveness. Similarly, the Business Efficiency factor also encompasses leading economic indicators linked to manufacturing activity. In addition, leading economic indicators related to the housing market are part of the Economic Performance factor of competitiveness. Finally, leading economic indicators on business start-ups fall under the Government Efficiency factor. The World Competitiveness Yearbook takes leading economic indicators from several of international, national and regional sources/organizations.
The World Competitiveness Yearbook complements leading economic indicators, and hard statistics in general, with the inclusion of survey data. Hard statistics form 2/3 of data while survey data constitute the remaining 1/3. In doing so, the Yearbook benefits by the incorporation of leading economic indicators in that they strengthen the objectivity of its competitiveness index because of the reliability of leading economic indicators. The following table presents some examples of leading economic indicators included in the World Competitiveness Yearbook.
Table 1. Leading economic indicators in the World Competitiveness Yearbook
|Stock market||Manufacturing activity||Housing market||Business start-ups|
|Stock market capitalization||Overall productivity||Cost-of-living index||Start-up days|
|Value traded on stock markets||Labor costs||Apartment rent||Business start-up procedures|
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Suggested WebsitesThe IMD World Competitiveness Center's Yearbook