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An Evaluation of the OECD Cyclically-Adjusted Primary Government Balance Forecasts
| Content Provider | Semantic Scholar |
|---|---|
| Author | Vuchelen, Jef Wit, Jesse De |
| Copyright Year | 2008 |
| Abstract | Forecasts of the cyclically-adjusted primary government balance are, potentially, informative as to the stance of future fiscal policies. This is sustained by the fiscal surveillance procedure for Eurozone members since the reformed Stability and Growth Pact of 2005. However, the quality of these forecasts has never been analyzed. We evaluate the properties of the December forecasts of the cyclically-adjusted primary government balance by the OECD for 19 countries. The forecasts for the current year, nowcasts, are reasonably accurate; the quality of the one-year-ahead and the two-year-ahead forecasts deteriorates however sharply when the forecast horizon increases. Despite their poor quality, forecasts are mostly unbiased and efficient and thus rational. Simple alternative forecasts for the cyclically-adjusted primary government balance do not systematically outperform the forecasts by the OECD. |
| Starting Page | 459 |
| Ending Page | 479 |
| Page Count | 21 |
| File Format | PDF HTM / HTML |
| Volume Number | 51 |
| Alternate Webpage(s) | https://dipot.ulb.ac.be/dspace/bitstream/2013/80125/1/ARTICLEVUCHELEN-DEWITpdf.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
