Why does the American economy seem to slow down each first quarter?

This very good Justin Wolfers piece outlines some possible explanations, for instance:

For those not keeping track, it boils down to two camps: economists who blame first-quarter weakness on idiosyncratic factors versus those blaming mismeasurement.

The weather would be one — but not the only — possible idiosyncratic factor.

I wonder, however, if a third class of explanation perhaps should be in play.  It is well-known that economies undergo relatively strong “seasonal cycles,” most notable a major contraction in the first quarter, following the boom of the holiday season.  Might this seasonal contraction interact with the real economy in a different way than before the Great Recession?  Perhaps negative economic momentum, even when expected, chills other drivers of economic activity more than it used to.  This could arise from complementarities, increasingly important thick market externalities, signal extraction problems combined with greater fearfulness, or perhaps it is revealing information about the fragility of risk premia.  Other mechanisms may be operating as well — can you think of any?

In other words, those first-quarter slumps are real, not idiosyncratic, and also not mismeasurements, but still they are (all other things being equal) likely temporary.

This is just a hypothesis, do you have any ideas about how to test it?


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