Abstract
In evaluating the one-year-ahead survey forecasts of key indicators for New Zealand, this study tests rationality under flexible loss to allow for the possibility of an asymmetric loss associated with forecast errors. For 1988–2011, the consensus forecasts of inflation, output growth, and interest rate are rational (efficient) under symmetric loss, out-perform the naïve benchmark, and are directionally accurate. In contrast, the consensus forecasts of unemployment and exchange rates are not of value since, while efficient, they are not directionally accurate and fail to out-perform the naïve benchmark. Utilizing actual and survey data, we have formulated a model to forecast the unemployment rate. Comparable unemployment forecasts from this model are superior to the survey forecasts for 2000–2011. As the final step, we examine the accuracy of individual forecasters. Our findings reveal both differences and similarities between the consensus and individual forecasts in terms of rationality and other accuracy measures.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
