Forecasting, Volume 5, Issue 4 (December 2023) – 4 articles

This paper assesses the usefulness of comprehensive payments data for macroeconomic predictions in Canada. Specifically, we evaluate which type of payments data are useful, when they are useful, why they are useful, and whether machine learning (ML) models enhance their predictive value. We find payments data with a factor model can help improve accuracy up to 25% in predicting GDP, retail, and wholesale sales; and nonlinear ML models can further improve the accuracy up to 20%. Furthermore, we find the retail payments data are more useful than the data from the wholesale system; and they add more value during crisis and at the nowcasting horizon due to the timeliness. The contribution of the payments data and ML models is small and linear during low and normal economic growth periods. However, their contribution is large, asymmetrical, and nonlinear during crises such as COVID-19. Moreover, we propose a cross-validation approach to mitigate overfitting and use tools to overcome interpretability in the ML models to improve their effectiveness for policy use. Full article

Globalization has gotten increasingly intense in recent years, necessitating accurate forecasting. Traditional supply chains have evolved into transnational networks that grow with time, becoming more vulnerable. These dangers have the potential to disrupt the flow of goods or several planned actions. For this reason, increased resilience against various types of risks that threaten the viability of an organization is of major importance. One of the ways to determine the magnitude of the risk an organization runs is to measure how popular it is with the buying public. Although risk is impossible to eliminate, effective forecasting and supply chain risk management can help businesses identify, assess, and reduce it. As a result, good supply chain risk management, including forecasting, is critical for every company. To measure the popularity of an organization, there are some discrete values (bounce rate, global ranking, organic traffic, non-branded traffic, branded traffic), known as KPIs. Below are some hypotheses that affect these values and a model for the way in which these values interact with each other. As a result of the research, it is clear how important it is for an organization to increase its popularity, to increase promotion in the shareholder community, and to be in a position to be able to predict its future requirements. Full article

Traffic operation efficiency is greatly impacted by the increase in travel demand and the increase in vehicle ownership. The continued increase in traffic demand has rendered the importance of controlling traffic, especially at intersections. In general, the inefficiency of traffic scheduling leads to traffic congestion, resulting in a rise in fuel consumption, exhaust emissions, and poor quality of service. Various methods for time series forecasting have been proposed for adaptive and remote traffic control. The prediction of traffic has attracted profound attention for improving the reliability and efficiency of traffic flow scheduling while reducing congestion. Therefore, in this work, we studied the problem of the current traffic situation at Muhima Junction one of the busiest junctions in Kigali city. Future traffic rates were forecasted by employing long short-term memory (LSTM) and autoregressive integrated moving average (ARIMA) models, respectively. Both the models’ performance criteria for adequacy were the mean absolute error (MAE), mean absolute percentage error (MAPE), and root mean squared error (RMSE). The results revealed that LSTM is the best-fitting model for monthly traffic flow prediction. Within this analysis, we proposed an adaptive traffic flow prediction that builds on the features of vehicle-to-infrastructure communication and the Internet of Things (IoT) to control traffic while enhancing the quality of service at the junctions. The real-time actuation of traffic-responsive signal control can be assured when real-time traffic-based signal actuation is reliable. Full article

Earth system predictions, from sub-seasonal to seasonal timescales, remain a challenging task, and the representation of predictability sources on seasonal timescales is a complex work. Nonetheless, advances in technology and science have been making continuous progress in seasonal forecasting. In a previous paper, a performance for temperature prediction by a modelling system named e-kmf^® was carried out in comparison with observations and climatology for a year of data; a low level of predictability in the sub-seasonal range, particularly in the second month, was observed over the Italian peninsula. Therefore, in this study, we focus our investigations specifically on the performance between the fifth and the eighth week of temperature forecasts over six years of simulations (2012–2018) to investigate the capability of the weather model to better reproduce the behavior of temperatures in the second month of the forecast. Although some differences in seasons are present, results have globally shown how temperature predictions have the potential to be quite skillful, with an average skill score of about 68%, with climatology used as reference; additionally, an overall anomaly correlation coefficient equal to 0.51 was shown, providing useful information for applications in planning, sales, and supply of natural energy resources. Full article