Forecasting world trade. Direct versus "bottom-up" approaches

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Forecasting world trade. Direct versus "bottom-up" approaches

Author Info

Stéphane Dées () (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.)
Matthias Burgert () (Humboldt University, Berlin and ENSAE. Address - ENSAE, 3, avenue Pierre Larousse, 92245 Malakoff Cedex, France.)

Additional information is available for the following registered author(s):

Stephane Dees

Abstract

In a globalised world economy, global factors have become increasingly important to explain trade-flows at the expense of country-specifc determinants. This paper shows empirically the superiority of direct forecasting methods, in which world trade is directly forecasted at the aggregate levels, relative to "bottom-up" approaches, where world trade results from an aggregation of country-specifc forecasts. Factor models in particular prove rather accurate, where the factors summarise large-scale datasets relevant in the determination of trade-flows. JEL Classification: C53, C32, E37, F17.

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Paper provided by European Central Bank in its series Working Paper Series with number 882.

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Length: 38 pages
Date of creation: Mar 2008
Date of revision:
Handle: RePEc:ecb:ecbwps:20080882

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Article
- Matthias Burgert & Stephane Dees, 2009. "Forecasting World Trade: Direct Versus “Bottom-Up” Approaches," Open Economies Review, Springer, vol. 20(3), pages 385-402, July. [Downloadable!] (restricted)

This paper has been announced in the following NEP Reports:

NEP-ALL-2008-05-05 (All new papers)
NEP-CBA-2008-05-05 (Central Banking)
NEP-FOR-2008-05-05 (Forecasting)
NEP-INT-2008-05-05 (International Trade)

References listed on IDEAS
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