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Ferndiagnose des RWI-Konjunkturmodells
[Remote diagnosis of the RWI business cycle model]

Author

Listed:
  • Quaas, Georg

Abstract

The German Institute for Economic Research Berlin (DIW), the Halle Institute for Economic Research (IWH) and the Rheinisch-Westfälisches Institut Essen (RWI) have used their own models to calculate the macroeconomic effects of the measures under the coalition agreement for the 19th parliamentary term and published them in the spring report 2018 of the Joint Economic Forecast project group. A comparison with the simulations of two other econometric models, including an older version of the RWI business cycle model (KM), suggests that these effects have been overestimated. The study focuses on the results of the RWI, which least overestimates those effects. To test the overestimation hypothesis, (1) a black box method is used to show that the implicit multipliers of the simulation results are not plausible. In a further attempt (2), the problematic effects are calculated on the basis of multipliers published in 2012 from an older version of the KM and compared with those of the new version. The hypothesis can be confirmed. Finally, (3) the latest documentation of the new versions of the KM shows that the price development indices are not calculated correctly. This would explain why the simulation results of the KM have a bias. In view of the importance of the KM for the Rheinisch-Westfälisches Institut and beyond that for the project group Gemeinschaftsdiagnose, which informs the public twice a year about the expected economic development, but also because other models may also be affected by this problem, the experts should be informed and encouraged to check their own models. The public should be warned against overly optimistic forecasts. It goes without saying that the wrong calculation method, if it is still used, must be eliminated before further simulations and forecasts are published. For a publicly funded model, it would also be necessary to document which of the technically possible methods for implementing the annual overlap method has been implemented.

Suggested Citation

  • Quaas, Georg, 2019. "Ferndiagnose des RWI-Konjunkturmodells [Remote diagnosis of the RWI business cycle model]," MPRA Paper 95292, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:95292
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    References listed on IDEAS

    as
    1. Georg Quaas & Mathias Klein, 2012. "Einnahmen- und ausgabenseitige Multiplikatoren der deutschen Volkswirtschaft," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 92(10), pages 692-698, October.
    2. Projektgruppe Gemeinschaftsdiagnose, 2018. "Deutsche Wirtschaft im Boom – Luft wird dünner," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 71(08), pages 03-62, April.
    3. Wolfgang Nierhaus, 2005. "Vorjahrespreisbasis: Rechenregeln für die Aggregation," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 58(22), pages 12-16, November.
    4. Barabas, György & Döhrn, Roland & Gebhardt, Heinz, 2006. "Gesamtwirtschaftliche Wirkungen der Haushaltspolitik: Anmerkungen zu Heilemann, Quaas und Ulrich," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1949 - 2007), ZBW - Leibniz Information Centre for Economics, vol. 86(5), pages 322-325.
    5. Quaas, Georg, 2006. "Ganzheitliche Wirkungen von Dummyvariablen auf die Prognosegenauigkeit ökonometrischer Modelle – analysiert am Beispiel des RWI-Konjunkturmodells KM59 [Holistic effects of dummy variables on the fo," MPRA Paper 19028, University Library of Munich, Germany, revised 05 Dec 2009.
    6. Quaas, Georg, 2009. "Die Umsetzung der Annual-Overlap-Methode in ökonometrischen Modellen – eine Analyse der programmtechnischen Möglichkeiten von E-Views [The implementation of the annual-overlap method in econometric," MPRA Paper 19435, University Library of Munich, Germany.
    7. Wolfgang Nierhaus, 2004. "Zur Einführung der Vorjahrespreisbasis in der deutschen Statistik: Besonderheiten der Quartalsrechnung," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 57(15), pages 14-21, August.
    8. Ullrich Heilemann & Karsten Müller, 2018. "Wenig Unterschiede – Zur Treffsicherheit Internationaler Prognosen und Prognostiker [Few differences—on the accuracy of international forecasts and forecaster]," AStA Wirtschafts- und Sozialstatistisches Archiv, Springer;Deutsche Statistische Gesellschaft - German Statistical Society, vol. 12(3), pages 195-233, December.
    9. Heilemann, Ullrich & Quaas, Georg & Ulrich, Jens, 2006. "Gesamtwirtschaftliche Wirkungen der Haushaltspolitik des Koalitionsvertrages," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1949 - 2007), ZBW - Leibniz Information Centre for Economics, vol. 86(1), pages 27-36.
    10. Quaas, Georg, 2009. "Realgrößen und Preisindizes im alten und im neuen VGR-System [Macro-economic aggregates in real terms and price indices in the old and the new system of national accounts]," MPRA Paper 22316, University Library of Munich, Germany, revised 25 Apr 2010.
    11. Barabas, György & Döhrn, Roland & Spitznagel, Eugen, 2006. "Konjunktur und Arbeitsmarkt : Simulationen und Projektionen mit der IAB-Version des RWI-Konjunkturmodells," IAB-Forschungsbericht 200620, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
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    More about this item

    Keywords

    RWI business cycle model; price equations; simulation results;
    All these keywords.

    JEL classification:

    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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