Forecasting Economic Growth Using an Artificial Neural Network Model

The paper employs Artificial Neural Network (ANN) to forecast India's economic growth. Using the data set, during 1980-2005, it finds that ANN is an effective tool to forecast the economic growth. The ANN gives the evidence that there is possibility of extracting information hidden in the economic growth and predicting it into the future. It also works out the comparison between ANN model and Linear Regression Model (LRM) to forecast the economic growth. The results confirmed that ANN yields lower forecast errors in assessment to LRM. The evaluation of the proposed model is based on the estimation of the average behaviour of the Root Mean Square Error and Mean Absolute Error