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Information Rigidities Comparing Average and Individual Forecasts for a Large International Panel

We study forecasts for real GDP growth using a large panel of individual forecasts from 36 advanced and emerging economies during 1989–2010. We show that the degree of information rigidity in average forecasts is substantially higher than that in individual forecasts. Individual level forecasts are...

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Bibliographic Details
Main Author: Dovern, Jonas
Other Authors: Fritsche, Ulrich, Loungani, Prakash, Tamirisa, Natalia
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2014
Series:IMF Working Papers
Subjects:
Rational Expectations
Public Expenditure Review
Economic Theory
Econometric Analysis
Public Finance & Taxation
Expectations
Economic Theory & Philosophy
Prices, Business Fluctuations, And Cycles: Forecasting And Simulation
National Government Expenditures And Related Policies: General
Expenditure
Estimation
Econometric Models
Expenditures, Public
Rational Expectations; Economic Theory
Estimation Techniques
Econometrics
Econometrics & Economic Statistics
Public Finance
Speculations
Forecasting And Simulation: Models And Applications
United States
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
Description
Summary:We study forecasts for real GDP growth using a large panel of individual forecasts from 36 advanced and emerging economies during 1989–2010. We show that the degree of information rigidity in average forecasts is substantially higher than that in individual forecasts. Individual level forecasts are updated quite frequently, a behavior more in line “noisy” information models (Woodford, 2002; Sims, 2003) than with the assumptions of the sticky information model (Mankiw and Reis, 2002). While there are cross-country variations in information rigidity, there is no systematic difference between advanced and emerging economies
Physical Description:24 pages
ISBN:9781484305201

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