Advanced Search
MyIDEAS: Login to save this article or follow this journal

Rule-Based Forecasting: Development and Validation of an Expert Systems Approach to Combining Time Series Extrapolations

Contents:

Author Info

  • Fred Collopy

    (The Weatherhead School of Management, Case Western Reserve University, Cleveland, Ohio 44106)

  • J. Scott Armstrong

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

Abstract

This paper examines the feasibility of rule-based forecasting, a procedure that applies forecasting expertise and domain knowledge to produce forecasts according to features of the data. We developed a rule base to make annual extrapolation forecasts for economic and demographic time series. The development of the rule base drew upon protocol analyses of five experts on forecasting methods. This rule base, consisting of 99 rules, combined forecasts from four extrapolation methods (the random walk, regression, Brown's linear exponential smoothing, and Holt's exponential smoothing) according to rules using 18 features of time series. For one-year ahead ex ante forecasts of 90 annual series, the median absolute percentage error (MdAPE) for rule-based forecasting was 13% less than that from equally-weighted combined forecasts. For six-year ahead ex ante forecasts, rule-based forecasting had a MdAPE that was 42% less. The improvement in accuracy of the rule-based forecasts over equally-weighted combined forecasts was statistically significant. Rule-based forecasting was more accurate than equal-weights combining in situations involving significant trends, low uncertainty, stability, and good domain expertise.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://dx.doi.org/10.1287/mnsc.38.10.1394
Download Restriction: no

Bibliographic Info

Article provided by INFORMS in its journal Management Science.

Volume (Year): 38 (1992)
Issue (Month): 10 (October)
Pages: 1394-1414

as in new window
Handle: RePEc:inm:ormnsc:v:38:y:1992:i:10:p:1394-1414

Contact details of provider:
Postal: 7240 Parkway Drive, Suite 300, Hanover, MD 21076 USA
Phone: +1-443-757-3500
Fax: 443-757-3515
Email:
Web page: http://www.informs.org/
More information through EDIRC

Related research

Keywords: combining forecasts; expert systems; extrapolation; judgment; rule base; rule-based forecasting;

Other versions of this item:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Sanders, NR & Ritzman, LP, 1990. "Improving short-term forecasts," Omega, Elsevier, vol. 18(4), pages 365-373.
  2. Armstrong, J. Scott & Collopy, Fred, 1992. "Error measures for generalizing about forecasting methods: Empirical comparisons," International Journal of Forecasting, Elsevier, vol. 8(1), pages 69-80, June.
  3. Robert Carbone & JS Armstrong, 2004. "Evaluation of Extrapolative Forecasting Methods: Results of a Survey of Academicians and Practitioners," General Economics and Teaching 0412008, EconWPA.
  4. Robert Carbone & Spyros Makridakis, 1986. "Forecasting When Pattern Changes Occur Beyond the Historical Data," Management Science, INFORMS, vol. 32(3), pages 257-271, March.
  5. Fildes, Robert & Lusk, Edward J, 1984. "The choice of a forecasting model," Omega, Elsevier, vol. 12(5), pages 427-435.
  6. JS Armstrong & Fred Collopy, 2004. "Causal Forces: Structuring Knowledge for Time-series Extrapolation," General Economics and Teaching 0412003, EconWPA.
  7. Scott Armstrong, J., 1988. "Research needs in forecasting," International Journal of Forecasting, Elsevier, vol. 4(3), pages 449-465.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:38:y:1992:i:10:p:1394-1414. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.