DEVELOPING A FORECASTING MODEL TO ENHANCE THE EFFICIENCY OF SUSTAINABLE DEVELOPMENT POLICY: ENRICHING THE LS-ARIMAX MODEL
Keywords:
LS-ARIMAX model, Sustainable Development, Long term, Short term, Exogenous VariablesAbstract
This study aims to develop a forecasting model by adapting the LS-ARIMAX model in order to enhance the efficiency of sustainable development policy. This unique LS-ARIMAX model is actually developed based on a great forecasting model known as ARIMA Model (p,d,q). AS the LS-ARIMAX model suggests, it comes in full name as Long Term and Short Term- Autocorrelation Integrated Moving Average with Exogeneous and Error Correction Mechanism (LS-ARIMAX model). As of many relevant studies are out in a review, it reflects that LS-ARIMAX model is a newly-developed model designed to support in a policy formulation and planning of Thailand and other countries. This model of LS-ARIMAX is different compared to other existing models and comes with unique key features; deploying a stationary data, integrating with co-integration analysis, considering exogenous variables, implementing ECT to optimize a long-term forecasting capacity and eliminating an issue of Heteroskedasticity, Multicollinearity, and Autocorrelation. Therefore, the above model becomes an ideal and potential forecasting model to be utilized in the process of national policy formulation and planning to achieve sustainability.
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