Can the IMF's Medium-Term Growth Projections Be Improved?
AbstractNumerous reports have noted that the IMF''s medium-term growth projections are overly optimistic, raising questions as to how these can be improved. To this end, we estimate a growth model and examine its out-of-sample forecasting properties relative to those of IMF projections. The model''s projections outperform those of the IMF in all regions and among most income groups-projections are less biased (one-quarter of the IMF bias) and have smaller standard errors (20 percent lower root mean squared errors) even after controlling for the IMF''s macroeconomic assumptions. The paper does not attempt to address the criticisms that have been leveled against the empirical growth literature, but the results suggest that benefits can be derived from bringing systematic analysis to bear on cross-country information.
Download InfoIf 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.
Bibliographic InfoPaper provided by International Monetary Fund in its series IMF Working Papers with number 04/203.
Date of creation: 01 Oct 2004
Date of revision:
Contact details of provider:
Postal: International Monetary Fund, Washington, DC USA
Phone: (202) 623-7000
Fax: (202) 623-4661
Web page: http://www.imf.org/external/pubind.htm
More information through EDIRC
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-10-22 (All new papers)
- NEP-FOR-2005-10-22 (Forecasting)
- NEP-MAC-2005-10-22 (Macroeconomics)
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.:
- Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
- N. Gregory Mankiw & David Romer & David N. Weil, 1990.
"A Contribution to the Empirics of Economic Growth,"
NBER Working Papers
3541, National Bureau of Economic Research, Inc.
- repec:fth:wobaco:1083 is not listed on IDEAS
- Alberto Musso & Steven Phillips, 2002.
"Comparing Projections and Outcomes of IMF-Supported Programs,"
IMF Staff Papers,
Palgrave Macmillan, vol. 49(1), pages 3.
- Steven Phillips & Alberto Musso, 2001. "Comparing Projections and Outcomes of IMF-Supported Programs," IMF Working Papers 01/45, International Monetary Fund.
- Jeffrey Sachs & Andrew Warner, 1995.
"Economic Reform and the Progress of Global Integration,"
Harvard Institute of Economic Research Working Papers
1733, Harvard - Institute of Economic Research.
- Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 1-118.
- Carmen M. Reinhart & Kenneth S. Rogoff, 2002.
"The Modern History of Exchange Rate Arrangements: A Reinterpretation,"
NBER Working Papers
8963, National Bureau of Economic Research, Inc.
- Carmen M. Reinhart & Kenneth S. Rogoff, 2004. "The Modern History of Exchange Rate Arrangements: A Reinterpretation," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 1-48, February.
- Reinhart, Carmen & Rogoff, Kenneth, 2004. "The modern history of exchange rate arrangements: A reinterpretation," MPRA Paper 14070, University Library of Munich, Germany.
- Easterly, William & Kremer, Michael & Pritchett, Lant & Summers, Lawrence H., 1993.
"Good policy or good luck?: Country growth performance and temporary shocks,"
Journal of Monetary Economics,
Elsevier, vol. 32(3), pages 459-483, December.
- William Easterly & Michael Kremer & Lant Pritchett & Lawrence H. Summers, 1993. "Good Policy or Good Luck? Country Growth Performance and Temporary Shocks," NBER Working Papers 4474, National Bureau of Economic Research, Inc.
- Barro, R.J., 1989.
"Economic Growth In A Cross Section Of Countries,"
RCER Working Papers
201, University of Rochester - Center for Economic Research (RCER).
- Ben-David, Dan & Papell, David, 1995.
"Slowdowns and Meltdowns: Post-war Growth Evidence from 74 Countries,"
CEPR Discussion Papers
1111, C.E.P.R. Discussion Papers.
- Dan Ben-David & David H. Papell, 1998. "Slowdowns And Meltdowns: Postwar Growth Evidence From 74 Countries," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 561-571, November.
- Ben-David, D. & Papell, D.H., 1996. "Slowdowns and Meltdowns: Post-War Growth Evidence from 74 Countries," Papers 9-96, Tel Aviv.
- Dan Ben-David & David H. Papell, 1997. "Slowdowns and Meltdowns: Postwar Growth Evidence from 74 Countries," NBER Working Papers 6266, National Bureau of Economic Research, Inc.
- Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
- Xavier X. Sala-i-Martin, 1997.
"I Just Ran Four Million Regressions,"
NBER Working Papers
6252, National Bureau of Economic Research, Inc.
- Tavares, Jose & Wacziarg, Romain, 2001. "How democracy affects growth," European Economic Review, Elsevier, vol. 45(8), pages 1341-1378, August.
- King, Robert G. & Levine, Ross, 1993.
"Finance and growth : Schumpeter might be right,"
Policy Research Working Paper Series
1083, The World Bank.
- Stephen Knack & Philip Keefer, 1995. "Institutions And Economic Performance: Cross-Country Tests Using Alternative Institutional Measures," Economics and Politics, Wiley Blackwell, vol. 7(3), pages 207-227, November.
- Judith Gold & Ruben Atoyan & Cornelia Staritz, 2007. "Guyana," IMF Working Papers 07/86, International Monetary Fund.
- Felipe, Jesus & Kumar, Utsav & Abdon, Arnelyn, 2012. "Using capabilities to project growth, 2010–2030," Journal of the Japanese and International Economies, Elsevier, vol. 26(1), pages 153-166.
- Juan Zalduendo, 2005. "Pace and Sequencing of Economic Policies," IMF Working Papers 05/118, International Monetary Fund.
- Tobias Kitlinski & Torsten Schmidt, 2011. "The Forecasting Performance of an Estimated Medium Run Model," Ruhr Economic Papers 0301, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- Helmut Hofer & Torsten Schmidt & Klaus Weyerstrass, 2011.
"Practice and Prospects of Medium-term Economic Forecasting,"
Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik),
Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 231(1), pages 153-171, February.
- Helmut Hofer & Torsten Schmidt & Klaus Weyerstrass, 2010. "Practice and prospects of medium-term economic forecasting," NRN working papers 2010-12, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
- Torsten Schmidt & Helmut Hofer & Klaus Weyerstrass, 2010. "Practice and Prospects of Medium-term Economic Forecasting," Ruhr Economic Papers 0177, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
- Biljana Petkovska, 2008. "Estimation of the investment function for the Republic of Macedonia," Working Papers 2008-04, National Bank of the Republic of Macedonia.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jim Beardow) or (Hassan Zaidi).
If references are entirely missing, you can add them using this form.