Do euro area forecasters (still) have faith in macroeconomic building blocks?
- We use the ECB's Survey of Professional Forecaster to show that euro area expectations are consistent with standard macroeconomic building blocks such as the Phillips curve, Okun's law, and the Taylor rule. Moreover, the paper finds that the financial and economic crisis of 2007-2009 did not change the expectation formation process as professional forecasters still adopt macroeconomic building blocks for their forecast. The scepticism that has recently been raised concerning macroeconomic building blocks has apparently not yet affected professional forecasts. On the contrary, we conclude that professional forecasters still have faith in macroeconomic building blocks.
Author: | Michael Frenkel, Eliza M. Lis, Jan-Christoph Rülke |
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URN: | urn:nbn:de:hbz:992-opus4-5202 |
Subtitle (English): | Expectation formation when economics is in crisis |
Series (Serial Number): | WHU – Working Paper Series in Economics (WP 09/03) |
Document Type: | Working Paper |
Language: | English |
Date of Publication (online): | 2017/11/23 |
Date of first Publication: | 2009/10/01 |
Release Date: | 2017/11/23 |
Tag: | Eurozone; Makroökonomische Modelle; Prognose Euro area; Forecasting; Macroeconomic models |
Page Number: | 26 |
Institutes: | WHU Economics Group / Chair of Monetary Economics |
JEL-Classification: | C Mathematical and Quantitative Methods / C3 Multiple or Simultaneous Equation Models / C32 Time-Series Models; Dynamic Quantile Regressions (Updated!) |
F International Economics / F3 International Finance / F37 International Finance Forecasting and Simulation | |
G Financial Economics / G1 General Financial Markets / G15 International Financial Markets | |
Licence (German): | Copyright for this publication |