‘Simple’ neural networks for forecasting by Bruce Curry
In a recent article in this journal Hwarng and Ang (HA) introduce what they describe as a ‘simple’ neural network for time
series forecasting. It is argued here that the approach is better described as logistic regressionapplied ina time-series context.
However, the HA model cannot be implemented through the standard LOGIT technique for handling qualitative dependent
variables. Nor is it same as the logistic di8erence equationused inpopulationbiology. Infact, it seems to have no ‘pedigree’
in the time-series literature. The paper explores the dynamic properties of the model. Chaotic behaviour will not arise, and
stability, especially inthe 9rst-order case, is quite likely.
Keywords: Neural network; Forecasting; Perceptron; Logistic; Stability