Advances in Management and Applied Economics

On Assessing Economic Forecasts: An Evaluation of Predictions on GDP, Industrial Production and Private Consumer Spending Trends in Twelve Industrial Nations

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• Abstract

  This study focuses on economic forecasts and their assessment. We evaluate forecasts on the growth of GDP, industrial production and private consumer spending in twelve major industrial nations. In addition to the unbiasedness test and comparisons with naive forecasts, we apply the information growth test and the TOTA coefficient. Economic forecasts are generally revealed to be quite successful. It is furthermore shown that the unbiasedness test is unsuited when it comes to distinguishing success from failure in terms of forecasting.