, much of bank output has to be estimated indirectly. In contrast to current statistical practice, dynamic optimizing models … of banks argue that compensation for bearing systematic risk is not part of bank output. We apply these models and find … that between 1997 and 2007, in the U.S. National Accounts, on average, bank output is overestimated by 21 percent and GDP …

, much of bank output has to be estimated indirectly. In contrast to current statistical practice, dynamic optimizing models … of banks argue that compensation for bearing systematic risk is not part of bank output. We apply these models and find … that between 1997 and 2007, in the U.S. National Accounts, on average, bank output is overestimated by 21 percent and GDP …