A general framework for forecast verification

A general framework for forecast verification based on the joint distribution of forecasts and observations is described: 1) the calibration-refinement factorization, which involves the conditional distributions of observations given forecasts and the marginal distribution of forecasts, and 2) the likelihood-base rate factorization, which involves the conditional distributions of forecasts given observations and the marginal distribution of observations. The names given to the factorizations reflect the fact that they relate to different attributes of the forecasts and/or observations. Some insight into the potential utility of the framework is provided by demonstrating that basic elements and summary measures of the joint, conditional, and marginal distributions play key roles in current verification methods. -from Authors

Duke Scholars

Author Robert L. Winkler Fuqua School of Business