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Nowcasting economic activity in European regions using a mixed-frequency dynamic factor model

Luca Barbaglia, Lorenzo Frattarolo, Niko Hauzenberger, Dominik Hirschbuehl, Florian Huber, Luca Onorante, Michael Pfarrhofer, Luca Tiozzo Pezzoli

arXiv 18 Jan 2024 · Econometrics · publishedInternational Journal of Forecasting (2025)

arXiv:2401.10054 · PDF · DOI · OpenAlex · Extracted main text

Abstract

Timely information about the state of regional economies can be essential for planning, implementing and evaluating locally targeted economic policies. However, European regional accounts for output are published at an annual frequency and with a two-year delay. To obtain robust and more timely measures in a computationally efficient manner, we propose a mixed-frequency dynamic factor model that accounts for national information to produce high-frequency estimates of the regional gross value added (GVA). We show that our model produces reliable nowcasts of GVA in 162 regions across 12 European countries.

Citation extraction

21
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29
in-text mentions
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distinct cited
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self-citations
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main-text words

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Most heavily cited references

The works this paper leans on most, across its whole bibliography — not restricted to papers in our corpus. Ranked by composite intensity, which combines how often a work is mentioned, how many sections mention it, and how much of that falls in the main text rather than the appendix.

ReferenceIntensityMentionsSectionsMain text
1Koop G, McIntyre S, Mitchell J, Poon A (2020) Regional output growth in the United Kingdom: More timely and higher frequency estimates from 19701.00073100%
2Mariano RS, Murasawa Y (2003) A new coincident index of business cycles based on monthly and quarterly series0.64422100%
3Mariano RS, Murasawa Y (2010) A coincident index, common factors, and monthly real GDP0.51121100%
4Billé AG, Tomelleri A, Ravazzolo F (2023) Forecasting regional GDPs: a comparison with spatial dynamic panel data models0.40511100%
5Henzel SR, Lehmann R, Wohlrabe K (2015) Nowcasting regional GDP: The case of the free state of saxony0.40511100%
6Koop G, McIntyre S, Mitchell J, Poon A (2022) Using stochastic hierarchical aggregation constraints to nowcast regional economic aggregates0.40511100%
7Lehmann R, Wohlrabe K (2015) Forecasting GDP at the regional level with many predictors0.40511100%
8Carvalho CM, Polson NG, Scott JG (2010) The horseshoe estimator for sparse signals0.40511100%
9Carvalho T, Krammer F, Iwasaki A (2021) The first 12 months of COVID-19: a timeline of immunological insights0.40511100%
10Chan JC, Poon A, Zhu D (2023) High-dimensional conditionally Gaussian state space models with missing data0.40511100%

Showing the top 10 of 21 scored citations.