Journal on Policy and Complex Systems
Forecast Model Performance
Two different methods were used
for the predictions . First , ARI-
MA was used to determine how the dependent variables are impacted by the immigration variables . Another method used is empirical forecast intervals to reveal how the GDP growth rate and unemployment trend will change in the next 15 years ( 2017-2031 ). Moreover , in Figure 4 , we can see that the GDP growth rate is above zero and more stable without changing significantly . In Figure 5 , the prediction trend of the unemployment rate is between 4 % and 6 %, with slight increases . In the other words , when the GDP growth rate declines , unemployment may increase .
Furthermore , in Figure 6 , CPI shows an increasing trend for the next 15 years . CPI is one of the important indicators for marketing and economic and government monetary policy . When CPI is more stable , the employment rate is higher and GDP grows . However , a rapid increase in the CPI causes inflation and economic instability . In Figure 7 , we can see that the urbanization index is below zero , which means the urban population may not be able to spread more extensively to other metropolitan areas .
Empirical Forecast Intervals
Lee and Scholtes ’ s ( 2014 ) empirical
prediction intervals were constructed based on the distribu-
Figures 4-7 . ARMIA forecast predictions . 68