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When are GDP forecasts updated? Evidence from a large international panel

  • Dovern, Jonas

Based on a large international panel of surveyed GDP forecasts I analyze the frequency of forecast revisions and the factors that influence the likelihood of forecast revisions. I find that each month on average 40%–50% of forecasters revise their forecasts. In addition, I find that the likelihood of forecast revisions significantly depends on a number of factors such as the forecast horizon, the business-cycle, or strategic interactions between forecasters. My results suggest that a realistic modeling of expectations/forecasts of agents has to take into account cross-sectional heterogeneity, strategic interaction between agents, and effects of the economic environment—features that existing models such as the sticky information framework are missing.

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Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 120 (2013)
Issue (Month): 3 ()
Pages: 521-524

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Handle: RePEc:eee:ecolet:v:120:y:2013:i:3:p:521-524
Contact details of provider: Web page: http://www.elsevier.com/locate/ecolet

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  1. Maćkowiak, Bartosz & Wiederholt, Mirko, 2009. "Optimal sticky prices under rational inattention," Working Paper Series 1009, European Central Bank.
  2. Álvarez, Luis J., 2007. "What Do Micro Price Data Tell Us on the Validity of the New Keynesian Phillips Curve?," Economics Discussion Papers 2007-46, Kiel Institute for the World Economy.
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  11. Ricardo Reis, 2005. "Inattentive Producers," NBER Working Papers 11820, National Bureau of Economic Research, Inc.
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  17. Sims, Christopher A., 2003. "Implications of rational inattention," Journal of Monetary Economics, Elsevier, vol. 50(3), pages 665-690, April.
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