Thanks Rathin for engaging in this discussion. I agree there can be serious political biases in economic forecasts, but that should not lead us to think that there is one single, objective way of forecasting. Having been in that business for some time while in charge of the UN’s World Economic Situation and Prospects (thanks Anis for making the reference!), I know first hand that no economic forecasting model is perfect (or even unbiased because of the necessary underlying assumptions). While at the UN we tried (and still try) to make proper sense of what directions the global economy is likely to take, the path to the future is fraud with uncertainties, many of which are difficult or impossible to capture in forecasting models. The proof of the pudding is in what forecasters have to say (ex ante) about off trend changes, like the 2008-2009 Great Recession. At the UN we could warn of this being a story foretold by connecting the right dots, but it was not something which came out of the world economic forecasting model we used for that. Rather, it built on the a priori analysis of interlinked global events and risks, which subsequently was put to a test through a scenario analysis (at difference of calling it a “prediction”). In short good forecasting is a matter of good analysis (an art if you like), but not an exact science. Anyone who took the risks built up before the crisis seriously could see it coming (even if not being able to pin down its precise timing). Those that saw the risks, but did not take them seriously, failed to connect the dots or suffered from cognitive dissonance (as the report of the IMF Evaluation Office concluded as a key explanation of why the IMF WEO failed to see the crisis coming).
Aside from this wisdom, the least forecasters should do, is to give continuous accountability of their track record. The UN’s can be found, for instance, in the WESP 2008 (http://www.un.org/en/development/desa/policy/wesp/wesp_archive/2008wesp.pdf).
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