Why did we fail to predict GDP during the last cycle? A breakdown of forecast errors for Austria
AbstractThis paper proposes an informal taxonomy to break down forecast errors of institutional forecasts. This breakdown is demonstrated for the forecasts of the Oesterreichische Nationalbank (OeNB) for Austrian GDP. The main result is that the largest part of the forecast errors can be explained by erroneous projections of the international environment. Data revisions also substantially contribute to the forecasting error for the forecast of the current year. Domestic exogenous variables play a minor role only. The inclusion of judgement improves the forecasting performance.
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Bibliographic InfoPaper provided by Oesterreichische Nationalbank (Austrian Central Bank) in its series Working Papers with number 151.
Date of creation: 11 Feb 2009
Date of revision:
Postal: Oesterreichische Nationalbank, Economic Studies Division, c/o Beate Hofbauer-Berlakovich, POB 61, A-1011 Vienna, Austria
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-03-14 (All new papers)
- NEP-BEC-2009-03-14 (Business Economics)
- NEP-CBA-2009-03-14 (Central Banking)
- NEP-FOR-2009-03-14 (Forecasting)
- NEP-MAC-2009-03-14 (Macroeconomics)
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