Industry-specific shocks drive two-thirds of economic fluctuations, new study finds.
Sectoral shocks play a big role in economic ups and downs. By studying different industries and how they rely on each other, researchers found that industry-specific shocks cause about two-thirds of the changes in overall output. This is a lot more than we thought before. The key to figuring this out was looking at how industries buy things from each other, which past studies didn't pay much attention to.