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Title: Combine to compete: improving fiscal forecast accuracy over time
Author: Carabotta, Laura
Claeys, Peter Gunther
Keywords: Macroeconomia
Dèficit públic
Previsió econòmica
Cicles econòmics
Budget dèficits
Economic forecasting
Business cycles
Issue Date: 2015
Publisher: Universitat de Barcelona. Facultat d'Economia i Empresa
Series/Report no: [WP E-Eco15/320]
Abstract: Budget forecasts have become increasingly important as a tool of fiscal management to influence expectations of bond markets and the public at large. The inherent difficulty in projecting macroeconomic variables – together with political bias – thwart the accuracy of budget forecasts. We improve accuracy by combining the forecasts of both private and public agencies for Italy over the period 1993-2012. A weighted combined forecast of the deficit/ ratio is superior to any single forecast. Deficits are hard to predict due to shifting economic conditions and political events. We test and compare predictive accuracy over time and although a weighted combined forecast is robust to breaks, there is no significant improvement over a simple RW model.
Note: Reproducció del document publicat a:
It is part of: UB Economics – Working Papers, 2015, E15/320
ISSN: 1136-8365
Appears in Collections:UB Economics – Working Papers [ERE]

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