Medium‐term forecasts of potential GDP and inflation using age structure information

Lindh, Thomas

doi:10.1002/for.906

Cited by 26 publications

(19 citation statements)

References 34 publications

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“…Except in the work by Bloom & Williamson (1998) and Lindh (1999) the implications of this evidence have not yet been discussed. Lindh (1999) presents evidence that statistical models of inflation and GDP growth explained mainly by the share of 5-year age groups perform well in out-of-sample forecasting on a horizon of 3-5 years ahead during the 1990s.…”

Section: Introductionmentioning

confidence: 94%

“…Bloom et al (2001), Bloom & Williamson (1998), Crenshaw et al (1997), Kelley & Schmidt (1995), Kelley & Schmidt (2001) show empirical support for this claim by finding a positive and significant effect of declining youth dependency ratios on economic growth in cross-country regressions applied to developing and developed countries. Significant age structure effects have also been found for economic growth, inflation and savings in OECD countries (Lindh (1999), Lindh &Malmberg (1999), Malmberg (1994)). …”

Section: Introductionmentioning

confidence: 96%

“…Lindh (1999) presents evidence that statistical models of inflation and GDP growth explained mainly by the share of 5-year age groups perform well in out-of-sample forecasting on a horizon of 3-5 years ahead during the 1990s. A different methodology is used in Bloom & Williamson (1998).…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

The effects of age structure on economic growth: An application of probabilistic forecasting to India

Prskawetz

Kögel

Sanderson

et al. 2007

International Journal of Forecasting

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may / 2004The Effects of Age Structure on Economic Growth: An Application of Probabilistic Forecasting to India Abstract During recent years there has been an increasing awareness of the explanatory power of demographic variables in economic growth regressions. We estimate a new model of the effects of age structure change on economic growth. We use the new model and recent probabilistic demographic projections for India to derive the uncertainty of predicted economic growth rates caused by the uncertainty in demographic developments.

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Section: Introductionmentioning

confidence: 94%

Section: Introductionmentioning

confidence: 96%

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The effects of age structure on economic growth: An application of probabilistic forecasting to India

Prskawetz

Kögel

Sanderson

et al. 2007

International Journal of Forecasting

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“…In addition, Lindh (2004) found evidence that information about the population age structure contains valuable information for medium-term inflation and GDP growth forecasts. In contrast, Jaimovich and Siu (2009) find an age structure effect on the short run but not on the medium run cyclical volatility.…”

Section: Introductionmentioning

confidence: 99%

The Forecasting Performance of an Estimated Medium Run Model

Kitlinski

Schmidt

2011

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily refl ect those of the editors. Terms of use: Documents in Ruhr Economic Papers #301

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“…Notable exceptions among the few papers that investigate GDP growth predictions from a medium-term perspective are Lindh (2004) and Batista and Zaluendo (2004).…”

Section: Introductionmentioning

confidence: 99%

Projecting the Medium-Term: Outcomes and Errors for GDP Growth

Kappler

2007

SSRN Journal

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Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW.Download this ZEW Discussion Paper from our ftp server:ftp://ftp.zew.de/pub/zew-docs/dp/dp07067.pdf Non-Technical SummaryThis paper first provides a survey of methods for producing medium-term projections that are used by governmental bodies in the major industrial countries and by international institutions. Among the many techniques, the production function approaches which explicitly relate trend output to capital and labor input as well as to technology are by far most commonly used.In the second part of the study it is assessed whether projections from a widely employed version of the production function approach convey a reliable view about future economic developments. For this purpose an out-of-sample forecast exercise based on quarterly data from National Accounts is carried out and a framework that allows evaluation of forecast errors based on consistent test statistics is developed. Empirical implementation of the proposed test strategy is straightforward and conducted for three to five year cumulative projections of GDP growth for the G7 countries. In addition, available projections from national and international sources are included in the forecast evaluation.The evaluation of the forecast errors of the out-of-sample experiment for the observation period from 1985 to 2005 highlights the following: The production function approach with its assumption that output gaps close over medium-term forecast horizons yields unbiased projections of real GDP growth for most countries, but misses other important features of actual GDP developments. Root mean squared errors and mean absolute errors are large and there are long periods where the forecasts are not in line with actual GDP growth. However, projections from the production function approach are generally capable of beating naïve forecasts in terms of root mean squared error although the differences in accuracy are mostly not statistically significant. Nevertheless, this is a remarkable result considering the fairly long forecast horizons.The pseudo forecasts from the out-of-sample exercise serve as a sort of "status quo" or neutral benchmark which incorporates an assessment of the future economic outlook if factor contributions and total factor productivity follow past trends. The comparisons of these pseudo forecasts with projections from official authorities shows that the German government's and the IMF's future assessments of economic developments, in particular, tended to deviate systematically fro...

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Medium‐term forecasts of potential GDP and inflation using age structure information

Cited by 26 publications

References 34 publications

The effects of age structure on economic growth: An application of probabilistic forecasting to India

The effects of age structure on economic growth: An application of probabilistic forecasting to India

The Forecasting Performance of an Estimated Medium Run Model

Projecting the Medium-Term: Outcomes and Errors for GDP Growth

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