Forecasting AR(4) regression: dynamic or static?
Posted: Thu Jun 02, 2011 5:12 am
Hi there,
I am attempting to forecast quarterly change in inflation, Δinflation, with an AR(4) regression. Specifically, I have data 1990Q1 to 2010Q1, and I want to forecast 2010Q2 to 2011Q2.
I'm wondering whether I should use dynamic or static forecasting? I don't know which one I should choose.
Thank you.
I am attempting to forecast quarterly change in inflation, Δinflation, with an AR(4) regression. Specifically, I have data 1990Q1 to 2010Q1, and I want to forecast 2010Q2 to 2011Q2.
I'm wondering whether I should use dynamic or static forecasting? I don't know which one I should choose.
Thank you.