Do Ifo Indicators Help Explain Revisions in German Industrial Production?

Abstract

This paper studies the information content of some Ifo indicators. In particular, we investigate whether two Ifo indicators, one on the current business situation, the other on current production development, provide information on revisions of German industrial production. A new feature of our analysis is the construction and use of a real-time dataset. We conclude that the Ifo indicators play a role in explaining revisions, but counterintuitively the business situation indicator performs better than the production indicator.JEL classification: C22, C53, C82

The information content of KOF indicators on Swiss current account data revisions

“…Jacobs and Sturm (2004) find that ifo indicators can play a role in improving first releases of German industrial production, a conclusion similar to the one we reach here for Swiss current account data and KOF survey indicators.…”

The Information Content of KOF Indicators on Swiss Current Account Data Revisions

“…Surveys have been used to model expectations, see for example Lee and Shields (2000), but research into the feasibility of using survey information to explain and improve first releases is still scarce. Jacobs and Sturm (2004) find that ifo indicators can play a role in improving first releases of German industrial production, a conclusion similar to the one we reach here for Swiss current account data and KOF survey indicators.…”

Should Forecasters Use Real-Time Data to Evaluate Leading Indicator Models for GDP Prediction? German Evidence

“…The revision process of new orders and IP was analyzed by Knetsch and Reimers (), who found that first releases of growth rates understate later estimates on average. Jacobs and Sturm () find some evidence that the ifo index is able to predict future revisions of IP. Taken together, these findings suggest that first estimates of IP and new orders may be not fully optimal; instead, these estimates may be biased and/or inefficient.…”