The bounds & likelihood-procedure – A simulation study concerning the efficiency of visual forecasting techniques

This paper is concerned with the visual extrapolation of time series as a forecasting technique. The bounds & likelihood-model suggested here is used to explain average predictions in a better way than the rational expectation hypothesis by taking certain bounds and likelihoods into account. The question is raised in the simulation study whether the bounds & likelihood-model can achieve a relatively high efficiency also in similar time series.