Medium Term Expenditure Framework > The Macro-fiscal analysis made simple

The Good Judgement Project

(1/1)

petagny:
Here's an interesting article about forecasting, just how bad it usually is and how to improve it:

http://www.ft.com/cms/s/2/3950604a-33bc-11e4-ba62-00144feabdc0.html#axzz3CXw0JT4F

Initial findings from the Good Judgement Project mentioned in the article is that the following approaches can lead to better forecasting:

1) 'Some basic training in probabilistic reasoning helps to produce better forecasts.'
2) 'Teams of good forecasters produce better results than good forecasters working alone.'
3) 'Actively open-minded people prosper as forecasters.'

Advice for better forecasting can be summarised under the CHAMP acronym:

'● Comparisons are important: use relevant comparisons as a starting point;
● Historical trends can help: look at history unless you have a strong reason to expect change;
● Average opinions: experts disagree, so find out what they think and pick a midpoint;
● Mathematical models: when model-based predictions are available, you should take them into account;
● Predictable biases exist and can be allowed for. Don’t let your hopes influence your forecasts, for example; don’t stubbornly cling to old forecasts in the face of news.'

Navigation

[0] Message Index