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The Past, Present, and Future of Macroeconomic Forecasting

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  • Francis X. Diebold

Abstract

Broadly defined, macroeconomic forecasting is alive and well. Nonstructural forecasting which is based largely on reduced-form correlations, has always been well and continues to" improve. Structural forecasting, which aligns itself with economic theory and hence rises and" falls with theory, receded following the decline of Keynesian theory. In recent years powerful new dynamic stochastic general equilibrium theory has been developed macroeconomic forecasting is poised for resurgence.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 6290.

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Date of creation: Nov 1997
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Publication status: published as Journal of Economic Perspectives, Vol. 12 (1998): 175-192.
Handle: RePEc:nbr:nberwo:6290

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