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Showing posts with the label weighted economic forecasts

Bayesian Time Varying Models Encourage More Accurate Economic Forecasts

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Artwork: Dr. Murad Abel Understanding trends of economic growth is a primary function of economists. Economic forecasts are an attempt to reach out and snap the future between one’s fingertips. Researcher by Hoogerheide, et. al. (2010) compares and contrasts various forms of Bayesian models and come to a conclusion about which are most accurate for national forecasts. Having accurate data and the proper forecasting tools has considerable influence on the type of decisions we make today to encourage higher probabilities of beneficial outcomes. The researchers study helped determine which Bayesian model-average approaches are likely to produce a predictive density forecasting for likely events. As all forecasts to date have weaknesses using an average help mitigate some of the uncertainty. They incorporated data sets such as U.S. stock index returns, compounded monthly return of S&P 500 index, and T-Bill rate to create 516 observational data points. Other researchers hav