DISAGREEMENT AMONG FORECASTERS IN G7 COUNTRIES

Using the Consensus Economics dataset with individual expertforecasts from G7 countries we investigate determinants of disagreement (crosssectionaldispersion of forecasts) about six key economic indicators. Disagreementabout real variables (GDP, consumption, investment and unemployment)has a distinct dynamic from disagreement about nominal variables(inflation and interest rate). Disagreement about real variables intensifiesstrongly during recessions, including the current one (by about 40 percent interms of the interquartile range). Disagreement about nominal variables riseswith their level, has fallen after 1998 or so (by 30 percent), and is considerablylower under independent central banks (by 35 percent). Cross-sectionaldispersion for both groups increases with uncertainty about the underlyingactual indicators, though to a lesser extent for nominal series. Countryby-country regressions for inflation and interest...