Are official forecasts of output growth in the EU still biased?

David Cronin and Kieran McQuinn

Journal of Policy Modeling, 2021, vol. 43, issue 2, 337-349

Abstract: An effective budgetary process requires accurate forecasts of future economic activity. Using data from Stability and Convergence Programmes and the European Commission’s Spring Forecasts, evidence is presented here which indicates deficiencies in official forecasting in the EU arising under the enhanced EU fiscal framework. Forecasts of output growth are unduly pessimistic, irrational, and influenced by recent economic activity. The article considers the reasons for and implications of such biases and proposes improvements to forecasting processes that could address these issues.

Keywords: Official forecasts; Forecasting bias; EU fiscal rules (search for similar items in EconPapers)
JEL-codes: C23 E37 E62 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:43:y:2021:i:2:p:337-349

DOI: 10.1016/j.jpolmod.2020.12.001

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