Revenue Forecasting Practices: Differences across Countries and Consequences for Forecasting Performance
AbstractThis paper reviews the practice and performance of revenue forecasting in selected OECD countries. While the mean forecast errors are small in most countries, the precision of the forecasts measured by the standard deviation of the forecast error differs substantially across countries. Based on a comparison of forecasting practices we show that these differences can be attributed to a large part to differences in the timing of the forecasts and in the tax structure. In addition, we find some evidence that differences in methods and institutions also matter for the forecasting precision. In particular, we find that the use of macroeconomic models as well as the independence of revenue forecasting are associated with a lower standard deviation of the forecast error.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2628.
Date of creation: 2009
Date of revision:
revenue forecasting; international comparison; OECD countries; forecast error;
Other versions of this item:
- Thiess Buettner & Bjoern Kauder, 2010. "Revenue Forecasting Practices: Differences across Countries and Consequences for Forecasting Performance," Fiscal Studies, Institute for Fiscal Studies, vol. 31(3), pages 313-340, 09.
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt
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