They pinpointed that date using advanced statistical techniques, publishing their results in an article in the December issue of The American Economic Review. Nailing down the exact turning point may require high-powered math, but anyone eyeballing a graph of changes in the growth rate of the nation's gross domestic product can see the general pattern. For this column, the researchers updated their work to include data through the third quarter of 2000, the most recent available. It's true that G.D.P. growth has varied a bit more than usual in recent quarters,'' they noted in an e-mail message. It's an important question, since what the Fed gives, the Fed can take away, either through mistakes or changes in inflation-fighting goals.
Public policy is transitory, private-sector progress less so.
And we can thank ''progress'' rather than ''policy'' for this particular good news, argue James Kahn of the New York Fed along with Dr. McConnell and Dr. Perez Quiros in a paper presented at the recent meetings of the American Economic Association in New Orleans. The researchers don't deny that good policy is important. But their work demonstrates that private-sector changes in organization and technology ''may be as important, or even more important, than policy,'' Dr. Kahn says. Monetary policy affects the whole economy, including investment and consumption. If Fed decisions had reduced the economy's volatility, every sector would be affected, and the change would definitely show up in sales fluctuations.