Recession vs. non-recession

Interesting question, one that we've debated here as well. A depressed economy, means low profits, a greater percentage of the outlays go to intermediate goods inflating indirect effects, but deflating induced effects as proprietor income is also deflated. In a manic economy, the opposite is true. Otherwise, does the industry pattern change much? (probably not) Capital spending follows the business cycle but that is a final demand and has little effect on the industry multipliers. For long run impacts, I sometimes think that a model with an average proprietor income per self-employment job and some sort of long range average corporate profit may be appropriate. Would we miss basic structural changes in an industry by going to an average? Not all industries suffer in a bad economy, and not all industries participate in a good economy. However, since we try to estimate the current economy with the current data set, what year would you consider to be the most recent "normal" economy? 2006-2007 were pumped up by the housing market ...it's been a while. The directly affected sector is the most important in determining the impact. I believe that the best case is, if possible, to get information regarding profits (corporate or proprietor)-also output, employment, compensation and anything else, then edit that sector and live with the most current data for the remaining sectors. Note, IF the Feds get serious about the debt, it will be hard to imagine the economy picking up much steam for the foreseeable future (a real big if).