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Georgia State University's Economic Forecasting Center - Economics At Work

Business Economics, Jan, 2004 by Rajeev Dhawan

Founded in 1973, the Economic Forecasting Center is celebrating its 30th anniversary this year! We have survived for so long in the business of economic forecasting not by just being accurate, but by also being an important go-to resource for the national and local media, regional companies, nonprofit organizations, and state and local governments. Our location helps, too. Located in the heart of downtown Atlanta--a city that grew tremendously in the last two decades to become the star of the modern South--the Economic Forecasting Center at Georgia State University's J. Mack Robinson College of Business is one of the few university-based forecasting centers in the United States that does a national, regional, and local metropolitan area forecast on a quarterly basis. Thus, the Center provides its subscribers with economic information and analysis on a regular basis, which gives them the tools to make smart, strategic business decisions and to keep their competitive edge.

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We achieve our goal by producing quarterly forecast reports for the nation, the state of Georgia, and the Atlanta metro area. Also, we produce a biannual report on the state of economic indicators for the Southeastern states. These are released to our subscribers at the quarterly forecast conferences, which are open to both the public and the media. Additionally, we hold a private meeting three times a year for our corporate sponsors. These seminars are held a month after the forecast conference. They provide a forecast update and handle any interesting special topics that are suitable for a small audience in an interactive setting.

In terms of its core mission, the Economic Forecasting Center is significantly different from its Wall Street forecasting counterparts. This mission is to be the liaison between the university and the community, but more so from the business school's perspective. Our regular economic forecast publications and conferences not only get us media coverage, but also provide information to the business community and to state and local officials. Both the business school and the university get the added benefit of brand-name recognition through this event, a pleasant externality. At times this can be more important than the perceived accuracy of the forecasts!

Business leaders and the media consider the Economic Forecasting Center to be one of the most reliable and accessible sources for economic information. Luckily, the media calls us on both national and local issues to get an independent opinion. When it comes to media coverage, being a very small shop plays to our comparative advantage, reinforcing the independence of our economic thought and forecast pronouncements. To begin with, being a university-sponsored entity earns us a good platform to be independent by definition, which gives the media greater confidence in seeking our opinion, thus giving us greater exposure and perpetuating our independent growth. Independence is a big advantage of being in academia, and it more than makes up for the few negatives! Nothing, however, is fully independent. Wall Street research shops are pure cost centers for the firms' investment banking, brokerage, or fixed-income divisions. The recent stock market scandals and the bursting of the bubble have tainted their reputations. The support for my salary and the Center's staff comes from state coffers via the university, but the day-to-day running expenses have to be generated by selling our quarterly forecast publications, conference tickets, and sponsorships of the Center. In a way, we too, are a cost center to the university, but our compensation (no bonuses, no revenue or profit sharing) is not directly tied to the university's performance.

Unlike Wall Street firms, we don't release a daily update, or for that matter a weekly update, a web cast, or press release whenever something happens. We stick to our quarterly routine of forecast booklet releases. We just can't compete with them on these matters as our resources are limited. So our interaction with the media is the garden variety type: to provide commentary on economic news and data releases when asked.

The Center's marquee public activity is a quarterly forecast conference held during the third week of February, May, August, and November. Each half-day conference features four to five expert speakers chosen from the pool of our own business school faculty, local business executives, money managers, Federal Reserve Bank economists, or other industry practitioners. The conference ends with me giving a lengthy forecast presentation. The program topics may range from stock market performance and international events to real estate conditions and local growth. The conference manages to attract more than 250 business professionals from various industries and has become an excellent networking opportunity. Both TV and print media carry reports about the conference. It's a fee-based forum and an important source of soft funds (non-state or non-university-based revenue) for the Center.

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Georgia State University's Economic Forecasting Center - Economics At Work

Business Economics, Jan, 2004 by Rajeev Dhawan

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