Economic growth in the USSR,Hungary, and East and West Germany

The extensive research on Soviet production functions is here extended to three different economies for the post-war, post-recovery period. Many different forms of CES and Cobb-Douglas function are tested. Estimates for West Germany are plausible and well behaved. Those for East Germany and Hungary are not even plausible. Results for the USSR are plausible, but inspection of residuals via isoquant maps suggests that the whole period is not homogeneous. Further tests suggest a structural change around 1965 as one possibility; the change involves faster technical change and an elasticity of substitution after 1965 not significantly different from unity.     

The strategy of professional forecasting

We develop and compare two theories of professional forecasters’ strategic behavior. The first theory, reputational cheap talk, posits that forecasters endeavor to convince the market that they are well informed. The market evaluates their forecasting talent on the basis of the forecasts and the realized state. If the market expects forecasters to report their posterior expectations honestly, then forecasts are shaded toward the prior mean. With correct market expectations, equilibrium forecasts are imprecise but not shaded. The second theory posits that forecasters compete in a forecasting contest with pre-specified rules. In a winner-take-all contest, equilibrium forecasts are excessively differentiated.     

Progress under pressure: The evolution of antitrust policy in Australia

Australia has developed a balanced and comprehensive antitrust policy. But the process of evolution has seen conflict, misunderstanding and error in applying the relevant economic concepts. Whether antitrust legislation is needed, and in what form, is still debated, as are ways of incorporating new approaches in economics. This is a documented account and commentary on the twenty years of evolution, designed especially for non-Australian readers seeking to gain advantage and avoid error by studying the experience of another country.     

International comparisons of the effects of nonmarket-sector growth

This paper examines the implications for macroeconomic performance of differing rates of growth of the nonmarket sector in different countries. It provides a framework within which international comparisons of nonmarket-sector expansion can be made and identifies possible consequences of employment growth in both market and non-market sectors. This analysis is then applied to a sample of developed and less developed countries, which suggests that, among developed countries, the adverse effects associated with nonmarket-sector expansion have probably been greatest in the U.K. Similar effects, however, are evident in several less developed countries.     

Forecasting Using Long-Order Autoregressive Processes: An Example Using Housing Starts

A long autoregressive (AR) modeling procedure for monthly U.S. housing starts data is considered. Neither differencing to remove the trend, nor differencing to remove the seasonal component is required in this method. The model is fitted by a Householder transformation-Akaike AIC criterion algorithm. Forecast performance is compared to that obtained by the Box-Jenkins ARIMA method. The prediction error variance of the long AR model method tends to be smaller than the prediction error variance of the Box-Jenkins model method. The long AR method is well suited for housing market time-series which are characterized by both strong seasonal and slowly changing trend components.