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A Study of the Use of the Delphi Method, A Futures Research Technique For Forecasting Selected U.S. Economic Variables And Determining Rationales for Judgments

Research Projects – Finance/Investment


A Study of the Future Course of Economic Variables Using Futures Research Techniques.

With discontinuities, disruptions, and outliers occurring more frequently than in the past, actuaries may find it useful to supplement traditional models and methods with a multi-disciplined approach to forecasting the future course of economic variables. The Futurism Section, Investment Section, Committee on Finance Research and Committee on Knowledge Extension Research sponsored this project, which investigates the merits of conducting a study on economic variables utilizing the Delphi method, a futures research technique. Guided by Ted Gordon, a well-known futurist, and Steve Easson, Chair of the Project Oversight Group, this study surveyed a diverse panel of experts for their opinions on a plausible range of values for the following economic variables in 2024.

  1. Annual Increase in the Consumer Price Index
  2. 10–Year Treasury Spot Yield
  3. S&P 500 Total Rate of Return
  4. Corporate Baa Spot Yield

In addition, the panel’s rationale, thought processes, and techniques utilized in developing the estimates as well as plausible developments that could influence the estimates were also examined.

While the objective of a Delphi study is to arrive at a stable set of results among the panel of experts (not necessarily a consensus), the value of the Delphi method rests with the ideas it generates providing a diverse range of perspectives which actuaries can use in making their own forecasting judgments.

Materials

A Study of the Use of the Delphi Method, A Futures Research Technique for Forecasting Selected U.S. Economic Variables and Determining Rationales for Judgments

Appendix A Round 1 Questionnaire

Appendix B Round 2 Questionnaire Study of Selected Economic Variables Using the Delphi Method

Appendix C - Round 1 Reasons for Projections

Appendix D - Round 2 Reasons for Projections

Appendix E - Round 2: Comments on Application of Judgmental Methods

Appendix F - Round 1 Future Developments

Appendix G - The Participants of the Delphi Report

Research Projects in Finance

  • Project Oversight Group
  • Steve Easson, Chair
  • Ted Gordon, Principal Investigator
  • Jack Bragg
  • Mark Bursinger
  • Sam Cox
  • Doug French
  • Jack Gibson
  • John Gould
  • Phil Heckman
  • Steve Malerich
  • Jim Reiskytl
  • Mark Rowley
  • Max Rudolph