Those who can, do. Those who can't, teach. And those just plain incompetent, work as forecasters for the IMF.

• Position: Off The News - Economic forecasting at International Monetary Fund, Organization for Economic Cooperation and Development - Brief Article

You see it often. Newspaper headlines around the world boldly declaring the latest IMF or OECD macroeconomic forecast. The Washington-based International Monetary Fund and the Paris-based Organization for Economic Cooperation and Development both enjoy huge budgets with which they deploy hundreds of macroeconomic specialists to measure growth and inflation through out the industrialized economies. "I'll be in Paris next week for the OECD meeting" is the typical hushed word from the latest new government economic official, suggesting that the macroeconomic secrets of the world will soon be in their grasp.

The only problem with this picture is that the economic predictions of both the IMF and OECD are among the worst in the entire economics profession. The central bank of Sweden recently studied fifty-two thousand forecasts made by 250 institutions between 1991 and 2000 for the United States, Japan, France. Germany, Italy, and Sweden. The forecasts of the IMF and OECD were included in the mix. The...