Office for Budget Responsibility's forecasts of GDP set to go beyond a joke

We've observed before how the UK's Office for Budget Revisionism has been leading the creation of the alternative wing of financial comedy by satirising economists' penchant for dodgy predictions with forecasts so misguided they seem deliberately bad.

Fans of its homage to Tommy Cooper can look forward to another packed bill on Wednesday: first, with Steve Nickell being grilled by the Treasury select committee as he reapplies for his job as the OBR's second-best known economist (his first term is ending); and second, his employer helping that process along by unveiling its biggest mishaps from the past year. Yes, publication of the OBR's annual "forecast evaluation report" will raise the usual guffaws, as the body designed to provide "independent and authoritative analysis" of the UK's public finances asks "why our real GDP forecasts continued to underperform".

It poses such questions despite the real joke being why economists never devised a better measure than GDP, which counts all goods and services no matter if they enhance our lives or not. This once prompted Atlantic Monthly magazine to observe: "By [GDP's] curious standard, the nation's economic hero is a terminal cancer patient going through a costly divorce" – and is a reason why economics gets dubbed the dismal science. Well, one of them.

Powered by article was written by Simon Goodley, for The Observer on Sunday 6th October 2013 00.05 Europe/London © Guardian News and Media Limited 2010


image: © Trodel

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