Archived Series > World Economic and Financial Surveys
Abstract
These studies provide supporting material for the analysis and scenarios in the World Economic Outlook.
Abstract
This paper describes the functioning of labor markets and to eliminate other structural obstacles to noninflationary growth. The decline in the price level in the home country will involve a rise in the real money supply and, if output is sluggish, this will result in an excess supply of money. This, in turn, will lead to a drop in the domestic interest rate and, given foreign interest rates, to a temporary depreciation of the exchange rate. Structural measures could also affect investment and the current account by raising the rate of return on capital in the home country. If capital is internationally mobile, a higher rate of return on capital would result in a rise in investment and a temporary deterioration in the home country’s current account, which will be financed by an inflow of foreign capital. The quantitative impact of financial market deregulation on the economy is rather uncertain.
Abstract
This paper examines the World Economic Outlook forecasting record for the principal performance indicators for the major industrial countries and corresponding aggregates and for groups of non-oil developing countries. Several criteria were used in evaluating the forecasts: the computation and evaluation of various summary statistics of forecast accuracy, bias, and efficiency; comparisons with alternative forecasts—naive forecasts and forecasts produced by the Organization for Economic Cooperation and Development (OECD) and by national forecasting agencies; the examination of turning-point errors and forecast performance in defined episodes; and, finally, some attempt to explain forecast error in terms of unanticipated developments in policy variables and oil prices. In judging the forecast performance of the World Economic Outlook, a number of points must be kept in mind. Most important, it has to be recognized that the period since the inception of the World Economic Outlook as a regular forecasting exercise has been extraordinarily rich in economic upheavals, which have made the odds against accurate forecasting formidable.
Abstract
This paper reviews the long-term growth performance of the major industrial countries and discusses some of the many factors that have been identified as possible sources of the marked slowdown in growth since the early 1970s. According to the view of different demographic developments across countries, it is useful to break the growth of output down into changes in tabor input and changes in labor productivity in order to obtain a basis for cross-country comparisons. Wage behavior in the face of energy price shocks appears to have differed considerably among the major industrial countries. Increased uncertainty, reflecting, in particular, changes in the international economic environment and the stop-go financial policies of several of the major countries during the 1970s, and is frequently cited as a possible reason for the slowdown in growth, mainly through its impact on private investment. Views on the contribution of slower net capital accumulation to the deceleration in growth depend upon assessments of whether the efficiency of investment declined significantly after 1973 and on assumptions made about technological change and the embodiment of technical progress.