Economic Forecasting

April 16, 1976

Report Outline
Evaluations of a Post-Recession
Growth of Forecasting Techniques
Economic Future and Public Policy
Special Focus

Evaluations of a Post-Recession

With the economy moving up from the bottom of the worst recession since the Depression Thirties, economic forecasts are popping out on all sides to tell the nation how far the upward currents are expected to go. A wide range of future happenings are being projected by the experts; the tone of their predictions ranges from foreboding to euphoria. In nearly each case, the envisioned future of the economy hangs on the individual forecaster's prescription of what should be done to keep the economy moving—or to prevent it from sliding back again.

The bumper crop of prognostications falls upon the nation at the same time economists are being chided—often from within their own ranks—for having failed to call the turns in the past. The recession that began in late 1973 and reached its bottom in the spring of 1975 proved to be both worse than its early signals indicated and not so deep and long-lasting as the most pessimistic of forecasters predicted once it got well under way.

Economists looking back at their predictions of two or three years ago are now pondering the reasons for the weakness of their foresight. They are also hedging their predictions for the rest of 1976 and 1977. If there is a consensus it is that yes, the recession is receding, but we are not out of the woods yet and things could go bad again, most likely in 1977. The toughest problem—how to stimulate economic growth and reduce unemployment without spurring inflation—remains to be solved.

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BROWSE RELATED TOPICS:
Economic Analyses, Forecasts, and Statistics