FPAS - Mark II

Forecasting and Policy Analysis Systems

The models in each generation of the FPAS are improved over time based on the needs of policymakers as well as the progress that has been made developing better theory and empirical methods. Of course,a ll of this is being built on the shoulders of giants of the profession that have done path-breaking work in academia as well as applying the ideas and principles in policy-making. Part of our job at the Better Policy Project is to provide training material for policy-making institutions that deals with general knowledge gaps as well as specific training in highly-specialized areas (e.g., modeling, current analysis and the blending of nowcasts into medium-term projections).

Experience has shown that it is important that all people involved in the FPAS should have a key understanding about what everybody else does. For example, it is a very bad  idea for model developers to simply hand-off the model to users without a process that gives people ample time to practice using the model. 

In addition, the experiences during the GFC and COVID has demonstrated that it is important that people doing current analysis are adapting quickly using the latest open-source software to develop new reports and analysis designed specifically for whatever the current circumstances and issues require. That does not mean that existing standard reports will not continue to be useful but they will need to be supplemented with other reports specifically designed for 

"I’d rather have Bob Solow than an econometric model, but I’d rather have Bob Solow with an econometric model than without one."

Stanly Fisher

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This speech provides a very nice presentation of the role of models for policy-making from a person that has excelled as one of absolute leading researchers and policymakers of his time. His work with Olivier Blanchard on "Lectures on Macroeconomics" continue to serve practitioners like us very well.

Olivier Blanchard

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Truly a breath-taking set of contributions by an intellectual leader of the profession. He provided important theoretical and empirical work that continues to help guide the development of the FPAS for both monetary and fiscal policy. His specific attention on avoiding dark corners has set the stage for new ways of thinking about the next generation of models to support the policy-making process.

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