The macroeconomic projections of the German government: A comparison to an independent forecasting institution

Robert Lehmann and Timo Wollmershäuser

German Economic Review, 2020, vol. 21, issue 2, 235-270

Abstract: This paper investigates the macroeconomic projections of the German government since the 1970s and compares it to those of the Joint Economic Forecast, which is an independent forecasting institution in Germany. Our results indicate that both nominal GDP projections are upward biased for longer forecast horizons, which seems to be driven by a false assessment of the decline in Germany’s trend growth and a systematic failure to correctly anticipate recessions. Furthermore, we show that the German government deviates from the projections of the Joint Economic Forecast, which in fact worsened the forecast accuracy. Finally, we find evidence that these deviations are driven by political motives.

Keywords: macroeconomic forecasting; forecast accuracy; independent forecasting; political economic biases (search for similar items in EconPapers)
JEL-codes: E30 E37 E39 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://doi.org/10.1515/ger-2019-0047 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
Working Paper: The Macroeconomic Projections of the German Government: A Comparison to an Independent Forecasting Institution (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:germec:v:21:y:2020:i:2:p:235-270

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/ger/html

DOI: 10.1515/ger-2019-0047

Access Statistics for this article

German Economic Review is currently edited by Peter Egger, Almut Balleer, Jesus Crespo-Cuaresma, Mario Larch, Aderonke Osikominu and Georg Wamser

More articles in German Economic Review from De Gruyter
Bibliographic data for series maintained by Peter Golla ().