Skip to the main content

Original scientific paper

https://doi.org/10.1515/crebss-2017-0002

The interrelationship between media reports and the recession in Croatia

Mirjana Čižmešija orcid id orcid.org/0000-0002-9873-7291 ; Faculty of Economics and Business, University of Zagreb, Zagreb, Croatia
Petar Sorić orcid id orcid.org/0000-0002-6773-264X ; Faculty of Economics and Business, University of Zagreb, Zagreb, Croatia
Ivana Lolić orcid id orcid.org/0000-0003-3112-7699 ; Faculty of Economics and Business, University of Zagreb, Zagreb, Croatia


Full text: english pdf 452 Kb

page 16-34

downloads: 337

cite


Abstract

This paper builds upon the Economist’s R-word (recession) index by forming a Croatian version of a media news-based economic uncertainty measure. Using the web archives of the four major Croatian news portals (Index.hr, Jutarnji list, Večernji list and 24 sata), an extensive database of as much as 531107 news articles is formed. The R-word index is obtained by calculating the monthly share of recession-related articles. This way Croatia is placed among the few rare world countries which have their own version of this index. It is found that the index is a leading indicator of economic activity in Croatia, preceding GDP growth rates by two months. Using rolling window correlations, the authors also prove that economic agents react to uncertainty shocks in the most intensive manner precisely at the onset of an economic crisis, while the correlation decreases in periods of more stable economic growth rates.

Keywords

Business and Consumer Surveys, economic uncertainty, leading indicator, R-word index, recession

Hrčak ID:

183709

URI

https://hrcak.srce.hr/183709

Visits: 694 *