Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam
Inflation is a key element of a national economy, and it is also a prominent and important issue influencing the whole economy in terms of marketing. This is a complex problem requiring a large investment of time and wisdom to attain positive results. Thus, appropriate tools for forecasting inflatio...
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| Format: | Article |
| Language: | English |
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Wiley
2015-01-01
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| Series: | Discrete Dynamics in Nature and Society |
| Online Access: | http://dx.doi.org/10.1155/2015/858157 |
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| _version_ | 1832564582318604288 |
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| author | Nhu-Ty Nguyen Thanh-Tuyen Tran |
| author_facet | Nhu-Ty Nguyen Thanh-Tuyen Tran |
| author_sort | Nhu-Ty Nguyen |
| collection | DOAJ |
| description | Inflation is a key element of a national economy, and it is also a prominent and important issue influencing the whole economy in terms of marketing. This is a complex problem requiring a large investment of time and wisdom to attain positive results. Thus, appropriate tools for forecasting inflation variables are crucial significant for policy making. In this study, both clarified value calculation and use of a genetic algorithm to find the optimal parameters are adopted simultaneously to construct improved models: ARIMA, GM(1,1), Verhulst, DGM(1,1), and DGM(2,1) by using data of Vietnamese inflation output from January 2005 to November 2013. The MAPE, MSE, RMSE, and MAD are four criteria with which the various forecasting models results are compared. Moreover, to see whether differences exist, Friedman and Wilcoxon tests are applied. Both in-sample and out-of-sample forecast performance results show that the ARIMA model has highly accurate forecasting in Raw Materials Price (RMP) and Gold Price (GP), whereas, the calculated results of GM(1,1) and DGM(1,1) are suitable to forecast Consumer Price Index (CPI). Therefore, the ARIMA, GM(1,1), and DGM(1,1) can handle the forecast accuracy of the issue, and they are suitable in modeling and forecasting of inflation in the case of Vietnam. |
| format | Article |
| id | doaj-art-fcd214861a79476d97990d9a2cf4fe87 |
| institution | Kabale University |
| issn | 1026-0226 1607-887X |
| language | English |
| publishDate | 2015-01-01 |
| publisher | Wiley |
| record_format | Article |
| series | Discrete Dynamics in Nature and Society |
| spelling | doaj-art-fcd214861a79476d97990d9a2cf4fe872025-02-03T01:10:43ZengWileyDiscrete Dynamics in Nature and Society1026-02261607-887X2015-01-01201510.1155/2015/858157858157Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of VietnamNhu-Ty Nguyen0Thanh-Tuyen Tran1International Relations Office, Lac Hong University, No. 10 Huynh Van Nghe Street, Bien Hoa, Dong Nai 71000, VietnamInternational Relations Office, Lac Hong University, No. 10 Huynh Van Nghe Street, Bien Hoa, Dong Nai 71000, VietnamInflation is a key element of a national economy, and it is also a prominent and important issue influencing the whole economy in terms of marketing. This is a complex problem requiring a large investment of time and wisdom to attain positive results. Thus, appropriate tools for forecasting inflation variables are crucial significant for policy making. In this study, both clarified value calculation and use of a genetic algorithm to find the optimal parameters are adopted simultaneously to construct improved models: ARIMA, GM(1,1), Verhulst, DGM(1,1), and DGM(2,1) by using data of Vietnamese inflation output from January 2005 to November 2013. The MAPE, MSE, RMSE, and MAD are four criteria with which the various forecasting models results are compared. Moreover, to see whether differences exist, Friedman and Wilcoxon tests are applied. Both in-sample and out-of-sample forecast performance results show that the ARIMA model has highly accurate forecasting in Raw Materials Price (RMP) and Gold Price (GP), whereas, the calculated results of GM(1,1) and DGM(1,1) are suitable to forecast Consumer Price Index (CPI). Therefore, the ARIMA, GM(1,1), and DGM(1,1) can handle the forecast accuracy of the issue, and they are suitable in modeling and forecasting of inflation in the case of Vietnam.http://dx.doi.org/10.1155/2015/858157 |
| spellingShingle | Nhu-Ty Nguyen Thanh-Tuyen Tran Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam Discrete Dynamics in Nature and Society |
| title | Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam |
| title_full | Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam |
| title_fullStr | Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam |
| title_full_unstemmed | Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam |
| title_short | Mathematical Development and Evaluation of Forecasting Models for Accuracy of Inflation in Developing Countries: A Case of Vietnam |
| title_sort | mathematical development and evaluation of forecasting models for accuracy of inflation in developing countries a case of vietnam |
| url | http://dx.doi.org/10.1155/2015/858157 |
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