Nowcasting of the Gross Regional Product
Business cycles are usually defined at a national level. The implicit assumption being that it affects all regions similarly. This is combined with a lack of timely information on regional economic development as annual values of the gross regional product (GRP) are often published with up to two years lag. The present paper evaluates a method of obtaining values of the GRP as soon as monthly and quarterly business cycle indicators become available. Building on earlier work on using bridge equations to obtaining quarterly values of GDP growth, a method is proposed were annual GRP growth is estimated using a large number of business cycle indicators. The procedure is applied to data for the Northern regions of Sweden. With the present method it is possible to continuously refine GRP growth values throughout the year. By utilizing the information content in available business cycle indicators, a nowcast of the GRP is obtained as opposed to a pure forecast based solely on past information. Nowcasts will then provide valuable information on how current highs or lows are affecting different regions.
|Date of creation:||Sep 2011|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.ersa.org
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.:
- Luis C. Nunes, 2005. "Nowcasting quarterly GDP growth in a monthly coincident indicator model," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 24(8), pages 575-592.
- Giuseppe Parigi & Roberto Golinelli, 2007. "The use of monthly indicators to forecast quarterly GDP in the short run: an application to the G7 countries," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 26(2), pages 77-94.
- Schumacher, Christian & Breitung, Jörg, 2008. "Real-time forecasting of German GDP based on a large factor model with monthly and quarterly data," International Journal of Forecasting, Elsevier, vol. 24(3), pages 386-398.
- Barhoumi, K. & Darné, O. & Ferrara, L., 2009.
"Are disaggregate data useful for factor analysis in forecasting French GDP?,"
232, Banque de France.
- Karim Barhoumi & Olivier Darné & Laurent Ferrara, 2010. "Are disaggregate data useful for factor analysis in forecasting French GDP?," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 29(1-2), pages 132-144.
- Jurgen A. Doornik, 2008. "Encompassing and Automatic Model Selection," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 70(s1), pages 915-925, December.
- Cecilia Frale & Massimiliano Marcellino & Gian Luigi Mazzi & Tommaso Proietti, 2009.
"Survey Data as Coicident or Leading Indicators,"
Economics Working Papers
ECO2009/19, European University Institute.
- Stock, James H & Watson, Mark W, 2002. "Macroeconomic Forecasting Using Diffusion Indexes," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(2), pages 147-62, April.
- Baffigi, Alberto & Golinelli, Roberto & Parigi, Giuseppe, 2004. "Bridge models to forecast the euro area GDP," International Journal of Forecasting, Elsevier, vol. 20(3), pages 447-460.
- Li, Baibing & Martin, Elaine B. & Morris, A. Julian, 2002. "On principal component analysis in L1," Computational Statistics & Data Analysis, Elsevier, vol. 40(3), pages 471-474, September.
- G. Rünstler & K. Barhoumi & S. Benk & R. Cristadoro & A. Den Reijer & A. Jakaitiene & P. Jelonek & A. Rua & K. Ruth & C. Van Nieuwenhuyze, 2009. "Short-term forecasting of GDP using large datasets: a pseudo real-time forecast evaluation exercise," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 28(7), pages 595-611.
When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa10p768. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier)
If references are entirely missing, you can add them using this form.