Handbook of Economic Forecasting

Chapter 5

Forecasting and Policy Making

Volker Wieland* and Maik Wolters^†,‡,     ^*Goethe University of Frankfurt, Grüneburgplatz 1, Institute for Monetary and Financial Stability, House of Finance, 60323 Frankfurt am Main, Germany, ^†University of Kiel, Wilhelm-Seelig-Platz 1, 24118 Kiel, Germany, ^‡Kiel Institute for the World Economy, Hindenburgufer 66, 24105 Kiel, Germany, ^*E-mail: [e-mail], ^‡E-mail: [e-mail]

Abstract

Policymakers use forecasts to project the consequences of particular policy decisions for certain policy targets. This chapter investigates the use of economic forecasting in policy making by discussing practical examples, providing new empirical evidence and computing forecasts using ...