Misery index (economics)
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The Misery Index is an economic indicator created by Chicago economist Robert Barro in the 1970s. It is the unemployment rate added to the inflation rate. It is assumed that both a higher rate of unemployment and a worsening of inflation both create economic and social costs for a country. A combination of rising inflation and more people of out of work implies a deterioration in economic performance and a rise in the misery index.
During the Presidential campaign of 1976, Democratic candidate, Jimmy Carter, made frequent references to the Misery Index, which by the summer of 1976 was at 13.57%.
Carter stated that no man responsible for giving a country a misery index that high, had a right to even ask to be President.
Carter won the 1976 election. However, by 1980, when President Carter was running for re-election against Ronald Reagan, the Misery Index had reached an all-time high of 21.98%. Carter lost the election to Reagan. During the Reagan era, the index averaged 12.19 with a 7.70 low.
U.S. Misery Index
Misery Index - Era by U.S president
| Rank | President | Time Period | Index Average | Low | High |
|---|---|---|---|---|---|
| 6 | Harry Truman | 1948 - 1952 | 7.87 | 1952-12 = 3.45 | 1948-01 = 13.63 |
| 1 | Dwight Eisenhower | 1953 - 1960 | 6.26 | 1953-07 = 2.97 | 1958-04 = 10.98 |
| 3 | John F. Kennedy | 1961 - 1962 | 7.27 | 1962-07 = 6.40 | 1961-07 = 8.38 |
| 2 | Lyndon Johnson | 1963 - 1968 | 6.78 | 1965-11 = 5.70 | 1968-07 = 8.19 |
| 7 | Richard Nixon | 1969 - 1973 | 9.98 | 1968-01 = 7.80 | 1973-12 = 13.61 |
| 10 | Gerald Ford | 1974 - 1976 | 15.93 | 1976-12 = 12.66 | 1975-01 = 19.90 |
| 11 | Jimmy Carter | 1977 - 1980 | 16.27 | 1978-04 = 12.60 | 1980-06 = 21.98 |
| 8 | Ronald Reagan | 1981 - 1988 | 12.19 | 1986-12 = 7.70 | 1981-09 = 19.33 |
| 8 | George H.W. Bush | 1989 - 1992 | 10.68 | 1989-09 = 9.64 | 1990-11 = 12.47 |
| 4 | William J. Clinton | 1993 - 2000 | 7.80 | 1998-04 = 5.74 | 1993-01 = 10.56 |
| 5 | George W. Bush | 2001 - 2005 | 7.98 | 2002-01 = 6.64 | 2005-09 = 9.97 |
Data Sources
The data for the misery index is obtained from unemployment data obtained from the U.S. Department of Labor and Inflation Rate from [Financial Trend Forecaster®]. The exact methods used for measuring unemployment and inflation have changed over time.
External links
- [The current and historical Misery Index]
- [PBS.org Teachers Guide: Jimmy Carter and the Misery Index]
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