Projections of the Scottish economy to 1984

The October 1979 issue of this Commentary (Volume 5 No 2) included an article which described the outline structure of a Medium Term Model of Scotland, designed to be used for forecasts or projections of the economy for periods beyond the established 6-12 months of the Institute's short-term forecasting model. Since late 1979, work has concentrated on the precise formulation of the model, data collection, the estimation of the parameters of the model, and tests of its accuracy. In the latter part of 1981, the model was used to generate projections (or conditional forecasts) of the Scottish economy in 1984. Details of the construction and testing of the model, and of the 1984 projections are to be published shortly. This article contains a synopsis of that report, emphasising in particular the results of the 1984 projections. For reasons of length, and of the orientation of this Commentary towards empirical and policy issues, description and evaluation of the estimation and testing of the model is limited; attention is concentrated on the results of the projections. Readers interested in the structure and estimation of the model are referred to the forthcoming report