A Better Way to Make Economic Forecasts
Try looking at what a country knows how to produce.
Capacity to grow.
Photographer: Kevin Frayer/Getty ImagesThis article is for subscribers only.
Economists are famously bad at predicting growth. A new technique might help them get a little better.
When assessing a country's potential to prosper, economists typically look at aggregate measures such as education, investment or national debt. This hasn't worked particularly well: China's economy, for example, has kept growing at a fast pace even though they've been predicting a slowdown for nearly 30 years.