Are macroeconomic forecasters optimists or pessimists? A reassessment of survey based forecasts

Rong Huang, Keith Pilbeam, William Pouliot

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We examine the issue of macroeconomic uncertainty in the Eurozone Area using forecasts from the European Central Bank's Survey of Professional Forecasters from the inception of the Euro in 1999Q1 to 2020Q2. We provide new insights concerning the optimism or pessimism of the distribution of forecasts by examining the 25th and 75th quartiles of the forecast distribution for each three key macro economic variables, GDP growth, inflation and unemployment. In addition, we examine the over- or under-confidence of forecasters in the survey by deriving the term structure of ex-ante uncertainty for up to 2 years ahead and compare it to ex-post uncertainty, enabling us to make some comparisons with existing US studies. Our results suggest that GDP growth forecasts tend towards optimism, while those for inflation and unemployment tend towards pessimism. In addition, ex-ante uncertainty in forecasts for the Eurozone Area is less than ex-post uncertainty at both the short and longer-term forecasting horizons, for all three variables. This suggests a tendency towards over-confidence on the part of Eurozone forecasters.
Original languageEnglish
Pages (from-to)706-724
Number of pages19
JournalJournal of Economic Behavior & Organization
Early online date8 Apr 2022
Publication statusPublished - May 2022

Bibliographical note

Publisher Copyright:
© 2022 Elsevier B.V.


  • Bayesian decision theory
  • ECB survey of professional forecasters
  • Ex-ante uncertainty
  • Ex-post uncertainty
  • Macroeconomic uncertainty
  • Subjective probability distribution

ASJC Scopus subject areas

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management


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