Dynamics Of US Economic Recovery: Can We Still Count On The Finance And Insurance Sector?

Abstract

This study takes a quantitative approach toexamine the dynamic effects of post-recession sector and sub-sector growthperformance of U.S. economic recovery. The study employs contributions to GDPgrowth rate among selected sectors and sub-sectors of the US economy to measurethe probability to significantly impact the rate of economic recovery.Estimation results based on logistic model indicates the finance and insurancesector of the economy is still critical to US economic recovery after a majormacroeconomic shock; however, the sector’s potential to significantlyaccelerate economic recovery seem to be overstated compared to other keysectors of the economy. Further test suggests the real estate sector of theeconomy is significantly weak in generating growth levels required tosignificantly accelerate economic recovery after major economic shock such asthe recession of 2008.