Page - 20 - in The Austrian Business Cycle in the European Context

20 chanical detection procedure according to some statistical crite- rion can substantially influence the result of a study. In order to avoid these pitfalls, outliers have been discussed with experts and considered in the light of economic history. 3.2.2 Calendar effects Apart from the business cycle, the varying number of working days influences economic output, too. Therefore, time series have to be cleaned for this influence. As far as they have not already been derived from the data base in adjusted form, this adjustment was made by the same SARIMA model combined with a regression on working day information as it was used for seasonal adjustment. As not only the varying number of working days constitutes the cal- endar effect, but also Easter and the leap year effectJ-', their influ- ence had been considered, too. Apart from testing for a significant Easter and leap year effect, two specifications for modelling the working day effect have been applied. One tests for the significance of the varying number of working days in total and the other checks for all working days separately. Thus, the regression includes the number of Mondays, Tuesdays, and so on. The discrimination between the two specifi- cations was done according to their t-values and auto-correlation properties of the residuals from the SARIMA model estimation. In most applications, as in this study, calendar effects are cleaned from the series under the assumption that they are independent from other components like the trend or the cycle. This orthogonal- ity assumption can be challenged by considerations of possibly larger working day effects in times of high capacity utilisation. Dur- ing recessions a large number of employees have to work part time and their productivity is probably quite low, so that an addi- 3' Other holidays like Christmas have not to be considered separately, as they oc- cur always in the same quarter of the year.