Category Archives: Uncategorized

Macroeconomists

Published by:

Like astronomers studying the evolution of stars or biologists studying the evolution of species, macroeconomists cannot conduct controlled experiments in a laboratory. Instead, they must make use of the data that history gives them. Macroeconomists observe that economies differ across countries and that they change over time.

 

Learn everything you need to know about Advanced Macroeconomics here.

3 Statistics very important Economist use are:

  1. Gross Domestic Product – GDP = National Total Income and the total expenditure
  2. Consumer Price Index – CPI = Measure the level of prices
  3. The Unemployment Rate

Judgmental Forecasting

Published by:

 

Human judgment permeates forecasting processes. In economic forecasting, judgment may be used in identifying the endogenous and exogenous variables, building structural equations, correcting for omitted variables, specifying expectations for economic indicators, and adjusting the model predictions in light of new information, official announcements, or “street” talk. Forecasters appear to be highly satisfied with judgmental approaches, preferring them over quantitative techniques due to reasons of accuracy and difficulties in obtaining the necessary data for quantitative approaches.

Judgmental biases argued to be especially relevant to forecasting include: illusory correlations, hindsight, selective perception, attribution of success and failure, underestimating uncertainty, optimism, overconfidence, and inconsistency in judgment. These biases could also be related to the organisational incentive system. For instance, forecasters mostly prefer to underforecast, justifying this tendency typically by their motivation to look better if the stated goals are surpassed, or by the choice to be conservative.

Judgmental forecast on the other hand, benefit from human ability to evaluate information that is difficult to quantify, as well as to accommodate changing constraints and dynamic environments. Extensive implications of judgmental forecasting performance necessitates detailed analysis targeted at educating the users and providers of forecasters to recognize those elements of the task which are best delegated to a statistical model and to focus their attention on the elements where their judgment is most valuable.

‘times of uncertainty and danger’

Published by:

Uncertainty is on the raise and under our eyes. Everybody can feel it. Even a small dose of it. Perhaps, it is due to a huge list of ongoing activities that we might explain slow through the week:

Restrictions travel to and from the United States

Protests around the world, including in American soil and European soil

Inflation and Deflation at the same time

Rise of Corruption involving private companies – The oher side of the capitalism

Lobbying – Isn’t the same as corruption?

Increase cost of Health Care – We will all pay for it

Insurance

Heat Waves

Lack of Transparency

Baby Boomers retaining their jobs

Unemployment

House price crisis

 

All these things together, and even isolated, are increasing our level of uncertanty on a daily basis. It is changing the way we are thinking and trusting in companies, enterprises, schooling and in our financial. A new approach is in need to start soon as the old fashion Chicago school does not work anymore to us. Good Luck to all of us. And, always remember that the world was not made only for you maintaining one’s faith above the torment of doubts.