IDEAS home Printed from https://ideas.repec.org/p/wpa/wuwppe/0408006.html
   My bibliography  Save this paper

A Composite Approach to Forecasting State Government Revenues

Author

Listed:
  • Thomas M Fullerton Jr

    (University of Texas at El Paso)

Abstract

Fiscal uncertainty has led many states to utilize a variety of economic and revenue forecasting methods. To improve accuracy, many budget analysts use alternative projections generated by different techniques. Composite modeling goes a step further and allows users to systematically combine two or more forecasts. This paper examines the effectiveness of composite forecasting of sales tax revenues in Idaho. Baseline projections are provided by an econometric model and by a univariate time series equation. Composite forecasts are found to outperform both baseline models. Combined forecasts are also found to be more precise than executive branch forecasts actually adopted from 1982 through 1985.

Suggested Citation

  • Thomas M Fullerton Jr, 2004. "A Composite Approach to Forecasting State Government Revenues," Public Economics 0408006, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwppe:0408006
    Note: Type of Document - doc; pages: 8
    as

    Download full text from publisher

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/pe/papers/0408/0408006.pdf
    Download Restriction: no

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/pe/papers/0408/0408006.ps.gz
    Download Restriction: no

    File URL: https://econwpa.ub.uni-muenchen.de/econ-wp/pe/papers/0408/0408006.doc.gz
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Bretschneider, Stuart I. & Gorr, Wilpen L. & Grizzle, Gloria & Klay, Earle, 1989. "Political and organizational influences on the accuracy of forecasting state government revenues," International Journal of Forecasting, Elsevier, vol. 5(3), pages 307-319.
    2. Thomas M Fullerton Jr, 2004. "Rational Reactions to Temporary Sales Tax Legislation," Public Economics 0408004, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. MOULIN, Laurent & SALTO, Matteo & SILVESTRINI, Andrea & VEREDAS, David, 2004. "Using intra annual information to forecast the annual state deficits : the case of France," LIDAM Discussion Papers CORE 2004048, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    2. Fullerton, Jr., Thomas M. & Taylor West, Carol A., 1998. "Regional Econometric Housing Start Forecast Accuracy in Florida," The Review of Regional Studies, Southern Regional Science Association, vol. 28(3), pages 15-42, Winter.
    3. Thomas M Fullerton Jr & Eiichi Araki, 2004. "New Directions in Latin American Macroeconometrics," Development and Comp Systems 0408002, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Armstrong, J. Scott, 1996. "Factors affecting new product forecasting accuracy in new firms : William B. Gartner, and Robert J. Thomas, 1993, Journal of Productive Innovation Management, 10, 35-52," International Journal of Forecasting, Elsevier, vol. 12(2), pages 321-322, June.
    2. Thomas M. Fullerton JR., 2001. "Specification of a Borderplex Econometric Forecasting Model," International Regional Science Review, , vol. 24(2), pages 245-260, April.
    3. Marina Riem, 2017. "Essays on the Behavior of Firms and Politicians," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 73.
    4. Stijn Goeminne & Benny Geys & Carine Smolders, 2008. "Political fragmentation and projected tax revenues: evidence from Flemish municipalities," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 15(3), pages 297-315, June.
    5. Merola, Rossana & Pérez, Javier J., 2013. "Fiscal forecast errors: Governments versus independent agencies?," European Journal of Political Economy, Elsevier, vol. 32(C), pages 285-299.
    6. Krol, Robert, 2013. "Evaluating state revenue forecasting under a flexible loss function," International Journal of Forecasting, Elsevier, vol. 29(2), pages 282-289.
    7. Beate Jochimsen & Robert Lehmann, 2017. "On the political economy of national tax revenue forecasts: evidence from OECD countries," Public Choice, Springer, vol. 170(3), pages 211-230, March.
    8. Leal Linares, Teresa & Pérez García, Javier J., 2011. "Análisis de las desviaciones presupuestarias aplicado al caso del presupuesto del Estado/The Performance of the Budgetary Target of the Central Government in Spain," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 29, pages 909(14á.)-9, Diciembre.
    9. Thiess Buettner & Bjoern Kauder, 2010. "Revenue Forecasting Practices: Differences across Countries and Consequences for Forecasting Performance," Fiscal Studies, Institute for Fiscal Studies, vol. 31(3), pages 313-340, September.
    10. MOULIN, Laurent & SALTO, Matteo & SILVESTRINI, Andrea & VEREDAS, David, 2004. "Using intra annual information to forecast the annual state deficits : the case of France," LIDAM Discussion Papers CORE 2004048, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    11. Mehdi Alaoui Mhammedi, 2016. "Erreurs de prévision budgétaire : Étude exploratoire des causes des excédents budgétaires dans les structures communales au Maroc," Post-Print hal-01901125, HAL.
    12. Teresa Leal & Javier J. Pérez & Mika Tujula & Jean-Pierre Vidal, 2008. "Fiscal Forecasting: Lessons from the Literature and Challenges," Fiscal Studies, Institute for Fiscal Studies, vol. 29(3), pages 347-386, September.
    13. repec:rre:publsh:v:33:y:2003:i:1:p:85-103 is not listed on IDEAS
    14. Lawrence, Michael & O'Connor, Marcus, 2005. "Judgmental forecasting in the presence of loss functions," International Journal of Forecasting, Elsevier, vol. 21(1), pages 3-14.
    15. Rossana Merola & Javier J. Pérez, 2012. "Fiscal forecast errors: governments vs independent agencies?," Working Papers 1233, Banco de España.
    16. de Mendonça, Helder Ferreira & Baca, Adriana Cabrera, 2022. "Fiscal opacity and reduction of income inequality through taxation: Effects on economic growth," The Quarterly Review of Economics and Finance, Elsevier, vol. 83(C), pages 69-82.
    17. JS Armstrong, 2004. "Forecasting for Environmental Decision Making," General Economics and Teaching 0412023, University Library of Munich, Germany.
    18. Thomas M Fullerton Jr, 2004. "Cross Border Business Cycle (Impacts on Commercial Electricity Demand," Urban/Regional 0407010, University Library of Munich, Germany.
    19. Mocan, H. Naci & Azad, Sam, 1995. "Accuracy and rationality of state General Fund Revenue forecasts: Evidence from panel data," International Journal of Forecasting, Elsevier, vol. 11(3), pages 417-427, September.
    20. Björn Kauder & Niklas Potrafke & Christoph Schinke, 2017. "Manipulating Fiscal Forecasts: Evidence from the German States," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 73(2), pages 213-236, June.
    21. Welch, Eric & Bretschneider, Stuart & Rohrbaugh, John, 1998. "Accuracy of judgmental extrapolation of time series data: Characteristics, causes, and remediation strategies for forecasting," International Journal of Forecasting, Elsevier, vol. 14(1), pages 95-110, March.

    More about this item

    Keywords

    Composite Forecasting; State Taxes; Applied Econometrics;
    All these keywords.

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wpa:wuwppe:0408006. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: EconWPA (email available below). General contact details of provider: https://econwpa.ub.uni-muenchen.de .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.