Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
We forecast New York state tax revenues with a mixed-frequency model using several machine learning techniques. We found that boosting with two dynamic factors extracted from a select list of New York and U.S. leading indicators did best to correctly update revenues for the fiscal year in direct multi-step out-of-sample forecasts. These forecasts were found to be informationally efficient over 18 monthly horizons. In addition to boosting with factors, we also studied the advisability of restricting boosting to select the most recent macro variables to capture abrupt structural changes. Since the COVID-19 pandemic upended all government budgets, our boosted forecasts were used to monitor revenues in real-time for the fiscal year 2021. Our estimates showed a drastic year-over-year decline in actual revenues by over 16% in May 2020, followed by several upward nowcast revisions that led to a recovery of −1% in March 2021, which was close to the actual annual value of −1.6%.