The great moderation was attributed 1 to (i) structural changes that may have increased macroeconomic flexibility and stability such as improved management of business inventories made possible by advances in computation and communication, increased depth and sophistication of financial markets, deregulation in many industries, the shift away from manufacturing to services and increased openness to trade and international capital flows etc.
(ii) improved performance of macroeconomic policies or (iii) good luck. The role of good luck in maintaining great moderation was extensively discussed and debated and, as anyone would expect, its role was discounted when things were going good.