New forecasting models outperform traditional methods, improving economic predictions.
The article compares different models to predict inflation and returns in the future. They looked at two types of models, RCAR and CHARMA, and found that CHARMA models are better at making accurate forecasts. These models were compared to other models that also try to predict how things will change over time. The researchers found that the CHARMA models were more accurate at predicting both the specific numbers and the range of possible outcomes.