The Great Moderation erases link between economic growth and volatility.
The study looked at how the Great Moderation affected the relationship between U.S. output growth and its volatility from 1947 to 2006. They used different models to analyze the data and found that there was no significant link between output growth and volatility. The variance of output fell after a structural break in volatility around 1982 or 1984. This means that the idea of a changing relationship between output growth and volatility might not be true.