Analyzing cross-validation for forecasting with structural instability

A-Tier
Journal: Journal of Econometrics
Year: 2022
Volume: 226
Issue: 1
Pages: 139-154

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

When forecasting with economic time series data, researchers often use a restricted window of observations or downweight past observations in order to mitigate the potential effects of parameter instability. In this paper, we study the problem of selecting a window for point forecasts made at the end of the sample. We develop asymptotic approximations to the sampling properties of window selection methods, and post-window selection point forecasts, where there is local parameter instability of various sorts. We examine risk properties of point forecasts made after cross-validation to select the window, and compare this approach to some alternative methods of selecting the window. We also propose a quasi-Bayesian form of cross-validation that we find to have good risk properties.

Technical Details

RePEc Handle
repec:eee:econom:v:226:y:2022:i:1:p:139-154
Journal Field
Econometrics
Author Count
2
Added to Database
2026-01-29