FAQ 2 – Macroeconometric Forecasting with Eviews
Open up your workfile containing the Caribbean data from the last session. Let’s practice transforming series by creating a new series that contains the (approximate) growth of real GDP.
Using Jamaica, for example, create a new variable, jam_dlrgdp = d(log(jam_rgdp)), using the Genr function on the top of the EViews menu.
Set the sample from 2000-2014 using the command smpl 2000 2014. Double-click on the new series to open it up.What has happened to real GDP growth in Jamaica since 2000?
The correct answer is:
Real GDP was positive from 2000-07, turned negative in 2008-10, and then rebounded to positive growth by 2014.
The incorrect answers are:
- Real GDP growth has been negative in all years.
- Real GDP has plummeted since the crisis.
- None of the above.
Explanation
If you open the real GDP object, click View → Graph → OK, you can see that real GDP peaked in 2007, declined, and has been increasing recently. Note that the above formula d(log()) is an approximation to the actual growth rate.