Empirical Economics

, Volume 29, Issue 3, pp 647–671 | Cite as

Forecasting industrial production and the early detection of turning points

Article

Abstract.

In this paper we propose a simple model to forecast industrial production in Italy up to 6 months ahead. We show that the forecasts produced using the model outperform some popular forecasts as well as those stemming from an ARIMA model used as a benchmark and those from some single equation alternative models. We show how the use of these forecasts can improve the estimate of a cyclical indicator and the early detection of turning points for the manufacturing sector. This is of paramount importance for short-term economic analysis.

Key words

Forecasting VAR models industrial production cyclical indicators 

JEL classification

C53 C32 E32 

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Copyright information

© Springer-Verlag 2004

Authors and Affiliations

  1. 1.Institute for Studies and Economic Analyses (ISAE)Piazza dell’IndipendenzaRomeItaly
  2. 2.University of MoliseFaculty of Economics, Department. S.E.G. e SCampobassoItaly

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