<abstract xmlns="http://www.w3.org/1999/xhtml"><p>Macroeconomic forecasters are often believed to idealistically work on improving the accuracy of their estimates based on for example the Root Mean Squared Error (RMSE). Unfortunately, reality is far more complex. Forecasters are not awarded equally for each of their estimates. They have their targets of acquiring publicity or to earn prestige. This article aims to study the results of Parkiet's competitions of macroeconomic forecasting during 2015–2019. Based on a logit model, we analyse whether more accurate forecasting of some selected macroeconomic variables (e.g. inflation) increases the chances of winning the competition by a greater degree comparing to the others. Our research shows that among macroeconomic variables three groups have a significant impact on the final score: inflation (CPI and core inflation), the labour market (employment in the enterprise sector and unemployment rate) and financial market indicators (EUR/PLN and 10-year government bond yields). Each group is characterised by a low disagreement between forecasters. In the case of inflation, we found evidence that some forecasters put a greater effort to score the top place. There is no evidence that forecasters are trying to somehow exploit the contest.</p></abstract>

Macroeconomic forecasters are often believed to idealistically work on improving the accuracy of their estimates based on for example the Root Mean Squared Error (RMSE). Unfortunately, reality is far more complex. Forecasters are not awarded equally for each of their estimates. They have their targets of acquiring publicity or to earn prestige. This article aims to study the results of Parkiet's competitions of macroeconomic forecasting during 2015–2019. Based on a logit model, we analyse whether more accurate forecasting of some selected macroeconomic variables (e.g. inflation) increases the chances of winning the competition by a greater degree comparing to the others. Our research shows that among macroeconomic variables three groups have a significant impact on the final score: inflation (CPI and core inflation), the labour market (employment in the enterprise sector and unemployment rate) and financial market indicators (EUR/PLN and 10-year government bond yields). Each group is characterised by a low disagreement between forecasters. In the case of inflation, we found evidence that some forecasters put a greater effort to score the top place. There is no evidence that forecasters are trying to somehow exploit the contest.

Macroeconomic forecasting in Poland: The role of forecasting competitions

SGH Warsaw School of Economics, Collegium of Economic Analysis

Central European Economic Journal

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

{"article-title":"Macroeconomic forecasting in Poland: The role of forecasting competitions"}

Macroeconomic forecasters are often believed to idealistically work on improving the accuracy of their estimates based on for example the Root Mean Squared...

Macroeconomic forecasting in Poland: The role of forecasting competitions

Published Online: Sep 10, 2020

Page range: 1 - 11

DOI: https://doi.org/10.2478/ceej-2020-0001

Keywords
forecasting, strategic behaviour, incentives, Parkiet

© 2020 Jakub Rybacki, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Macroeconomic forecasting in Poland: The role of forecasting competitions

Published Online: Sep 10, 2020

Page range: 1 - 11

DOI: https://doi.org/10.2478/ceej-2020-0001

Keywordsforecasting, strategic behaviour, incentives, Parkiet

© 2020 Jakub Rybacki, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords
forecasting, strategic behaviour, incentives, Parkiet