An evaluation of Chinese macroeconomic forecasts

    Research output: Journal PublicationArticlepeer-review

    10 Citations (Scopus)

    Abstract

    This article evaluates the quality of professional macroeconomic forecasts in China for the years 1995-2009. Using a large panel of forecasts on four macroeconomic variables (GDP, inflation, consumption and investment), we reject the hypothesis of unbiasedness, and find that forecasters have been, on average, overly pessimistic. The source of the bias lies primarily in forecasters' slow adjustment to structural shocks to the level of economic growth. We also reject the hypothesis that forecasters use information efficiently, and find that a large number of forecasters overreact to economic news. Finally, we document large differences of forecast accuracy across both forecasters and variables.

    Original languageEnglish
    Pages (from-to)229-246
    Number of pages18
    JournalJournal of Chinese Economic and Business Studies
    Volume10
    Issue number3
    DOIs
    Publication statusPublished - Aug 2012

    Keywords

    • China
    • forecast bias
    • forecast efficiency
    • macroeconomic forecasts

    ASJC Scopus subject areas

    • Economics, Econometrics and Finance (all)

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