Journal Article Technology and Price Structure in General Interdependence Systems Get access Victor Zarnowitz Victor Zarnowitz New York, N. Y. Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 23, Issue 2, 1955, Pages 109–125, https://doi.org/10.2307/2296294 Published: 01 January 1955

The aim of this study is to contribute to the measurement and analysis of errors in economists' predictions of changes in aggregate income, output, and the price level. Small sample studies of forecasts can be instructive, but their limitations must be recognized. Compilation of consistent forecast records extending over longer periods of tine is necessary to establish a reasonably reliable base for assessments of forecasting behavior and. performance. Thus the historical record of post-World War II forecasts assembled in the 1960's by the NBER is here extended and updated.

The authors define "consensus" as the degree of agreement among point predictions aimed at the same target by different individuals and " "uncertainty" as the diffuseness of the corresponding probability distributions. This distinction is made operational with the aid of the NBERAASA survey data on matched point and probabilistic forecasts of inflation and the rate of change in gross national product. The means of the two sets of forecasts agree closely. Standard deviations of point forecasts tend to understate uncertainty as measured by standard deviations of the predictive probability distributions. However, these measures of consensus and uncertainty are on the whole positively correlated. Copyright 1987 by University of Chicago Press.