Do Big Crops Get Bigger and Small Crops Get Smaller? Further Evidence on Smoothing in U.S. Department of Agriculture Forecasts

This study sought to determine whether monthly revisions of U.S. Department of Agriculture current-year corn and soybean yield forecasts are correlated and whether this correlation is associated with crop size. An ex-ante measure of crop size based on percent deviation of the current estimate from out-of-sample trend is used in efficiency tests based on the Nordhaus framework for fixed-event forecasts. Results show that available information about crop size is generally efficiently incorporated in these forecasts. Thus, although this pattern may appear obvious to market analysts in hindsight, it is largely based on new information and hence difficult to anticipate.

Marchant, Mary A.
Bosch, Darrell J.
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Journal Article
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Published in:
Journal of Agricultural and Applied Economics, Volume 45, Number 1
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JEL Codes:
Q10; Q13; E37

 Record created 2017-04-01, last modified 2018-01-22

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