Do US Macroeconomic Forecasters Exaggerate Their Differences?

25 Pages Posted: 16 Sep 2014

See all articles by Michael P. Clements

Michael P. Clements

University of Reading - Henley Business School

Date Written: September 15, 2014

Abstract

Application of the Bernhardt, Campello and Kutsoati (2006) test of herding to the calendar-year annual output growth and inflation forecasts suggests forecasters tend to exaggerate their differences, except at the shortest horizon when they tend to herd. We consider whether these types of behaviour can help to explain the puzzle that professional forecasters sometimes make point predictions and histogram forecasts which are mutually inconsistent.

Keywords: Macro-forecasting, imitative behaviour, histogram forecasts, point predictions.

JEL Classification: E37

Suggested Citation

Clements, Michael P., Do US Macroeconomic Forecasters Exaggerate Their Differences? (September 15, 2014). Available at SSRN: https://ssrn.com/abstract=2496433 or http://dx.doi.org/10.2139/ssrn.2496433

Michael P. Clements (Contact Author)

University of Reading - Henley Business School ( email )

Whiteknights
Reading, RG6 6BA
United Kingdom

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