Publication Date
8-2019
Abstract
This study evaluates the accuracy of previously published econometric forecasts for seven lodging sector variables that measure hotel activity in El Paso, Texas. The hotel forecasts have been generated annually using an econometric model of the El Paso metropolitan economy from 2006 forward. Predictive accuracy is evaluated relative to random walk benchmarks. Assessment is completed using both descriptive forecast error summary statistics as well as formal statistical tests. The econometric model outperforms the random walk benchmarks for a majority of the variables analyzed. However, statistical tests of forecast error differentials do not yield conclusive evidence in favor of the econometric historical track record. Tests of directional forecast accuracy also produce mixed results. Although the structural econometric model of hotel business conditions in this appears to provide useful predictive information, analysts and planners should also monitor recent history closely.
Comments
Technical Report TX19-1
Thomas M. Fullerton, Jr. and Adam G. Walke, 2019, Hotel Sector Forecast Accuracy in El Paso: 2006-2016, Technical Report TX19-1, University of Texas at El Paso Border Region Modeling Project.
A revised version of this study is forthcoming in Atlantic Economic Journal.