Firm-Level Planning Frequencies and Forecast Horizons

8 Pages Posted: 19 Feb 2022

See all articles by David Altig

David Altig

Federal Reserve Bank of Cleveland; Federal Reserve Banks - Federal Reserve Bank of Atlanta; University of Chicago - Booth School of Business

Jose Barrero

Instituto Tecnológico Autónomo de México (ITAM)

Nicholas Bloom

Stanford University - Department of Economics; National Bureau of Economic Research (NBER)

Steven J. Davis

University of Chicago; National Bureau of Economic Research (NBER); Hoover Institution

Brent Meyer

Federal Reserve Banks - Federal Reserve Bank of Atlanta

Emil Mihaylov

Federal Reserve Banks - Federal Reserve Bank of Dallas

Date Written: December 20, 2021

Abstract

We elicit new information about planning frequencies and forecast horizons from a survey of 500 US firms conducted in August 2018 and again in April-May 2021. Most firms update capital investment plans yearly, while updating plans for employment, prices and sales at monthly or quarterly intervals. Around one third of firms, mostly smaller ones, report having no formal plans. The most common forecast horizon for own-firm outcomes is one year ahead, with significant variation across firms. Planning frequencies and forecast horizons are extremely similar before and after the onset of the COVID-19 pandemic, which suggests they are rather insensitive to external economic conditions.

Keywords: Planning Horizon, Planning Updates, Forecast Horizon, Uncertainty

JEL Classification: L2, M2, O32, O33

Suggested Citation

Altig, David and Altig, David and Barrero, Jose and Bloom, Nicholas and Davis, Steven J. and Meyer, Brent H. and Mihaylov, Emil, Firm-Level Planning Frequencies and Forecast Horizons (December 20, 2021). Available at SSRN: https://ssrn.com/abstract=3989304 or http://dx.doi.org/10.2139/ssrn.3989304

David Altig

Federal Reserve Banks - Federal Reserve Bank of Atlanta

1000 Peachtree Street N.E.
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Federal Reserve Bank of Cleveland ( email )

East 6th & Superior
Cleveland, OH 44101-1387
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216-579-2041 (Phone)

University of Chicago - Booth School of Business

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

Jose Barrero

Instituto Tecnológico Autónomo de México (ITAM) ( email )

Av. Camino a Sta. Teresa 930
Col. Héroes de Padierna
Mexico City, D.F. 01000, Federal District 01080
Mexico

Nicholas Bloom (Contact Author)

Stanford University - Department of Economics ( email )

Landau Economics Building, Room 231
579 Serra Mall
Stanford, CA 94305-6072
United States
650-725-7836 (Phone)

HOME PAGE: http://economics.stanford.edu/faculty/bloom

National Bureau of Economic Research (NBER) ( email )

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Steven J. Davis

University of Chicago ( email )

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Chicago, IL 60637
United States
773-702-7312 (Phone)
773-702-0458 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Hoover Institution

434 Galvez Mall
Stanford University
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United States
773 251 1795 (Phone)

Brent H. Meyer

Federal Reserve Banks - Federal Reserve Bank of Atlanta ( email )

1000 Peachtree Street N.E.
Atlanta, GA 30309-4470
United States

Emil Mihaylov

Federal Reserve Banks - Federal Reserve Bank of Dallas

2200 North Pearl Street
PO Box 655906
Dallas, TX 75265-5906
United States

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