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Articles on Economic forecasting

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If wages just grow at the rate of the last 12 months, rather than at the higher growth in the budget forecasts, income tax collections will be A$7 billion less for 2019-20. Joel Carrett/AAP

Why biased budget forecasts make poor politics

Wonky forecasts show it’s time for a new approach that adopts more conservative forecasts, and makes a genuine commitment to budget repair.
Despite the notorious unreliability of forward estimates, the government has included projections for a 10-year period in this year’s federal budget. Image from

Government takes a punt on rubbery forward estimates, while ignoring tax reform agenda

When assessing some of the assumptions underpinning Wayne Swan’s 2013 federal budget, two things spring to mind: the Henry Tax Review and the notorious inaccuracy of forward estimates. History shows it…
If there’s one thing we can say with certainty, it’s that economic forecasting is far from an exact science. Image from

When it comes to economic forecasting, it’s wise to admit to uncertainty

One certainty about economic forecasts is that, almost certainly, they will prove to be incorrect. The best forecasters can hope for is not to make systematic errors – to get it right on average – and…
System 1 thinkers on the left, System 2 thinker on the right? AAP

Budget 2012: Why the experts will get it wrong

It’s an old joke, but hard to resist around Budget time. That is, that economic forecasting was invented to make astrology look respectable. Over the past few days we’ve heard a lot about how notoriously…

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