# NMTA Economic Forecast - PowerPoint PPT Presentation

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NMTA Economic Forecast. November 9, 2011. Jim Hebert Hebert Research, Inc. 2011 Nobel Prize Winners Thomas Sargent and Christopher Sims. Structural Macroeconomic Model (X,Y) = (Y,X) Mathematical Model - Rate of Change Statistical Model - Historical Variables that do not change:

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NMTA Economic Forecast

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#### Presentation Transcript

NMTA

Economic Forecast

November 9, 2011

Jim Hebert

Hebert Research, Inc.

### 2011 Nobel Prize WinnersThomas Sargent and Christopher Sims

• Structural Macroeconomic Model

(X,Y) = (Y,X)

• Mathematical Model - Rate of Change

• Statistical Model - Historical Variables that do not change:

X= el+allX-1 + a21X-2 +BllYl + b21Y-2 + cllZ-1 + CZ ~ Z+ -el

Y= c2 + aEX-1 + a22X-2 + buy1 + b22Y-2 + CEZ-+ ~c22Z-2 + e2

Z= c3 + a13X-1 + ~ 2 ~X+- 2b i3Y-I + b23x2 + c ~ ~ + Z c2-3Z~-2 + e3

### Market Demand Based on Conditional Probabilities

• Where P(Xi │Yj) = Pij / (∑ Pij)

• X1 = Ability to purchase

X2 = Willingness

X2 = Delayed Decision

### Demand Equation For Marine Products and Service

• d = f {Hp + Eu}

• Where beta home price – 0.297

• Employment – 0.685

• R2 = 0.878

### 2011 Crisis of Confidence – C5

• Consumer Confidence