Strategic Prediction of the Business Cycle using the Fuzzy Regression Model: a Study of the Council of Economic Planning and Development in Taiwan

Understanding the current business cycle of a nation is essential for individuals, enterprises, and the government in order to make appropriate strategic decisions and take advantage of business opportunities. At a specific period of economic activities, the business cycle develops moderately and may lead to negative growth or economic recession when the economic activity expands to the peak. Business cycle functions as an indicator for the economic development of a nation and thus, it is an important tool for decision-makers. For example, the situation of the business cycle in Taiwan is acquired from the cyclical indicators, economic monitoring indicator, and reference dates of business cycles in Taiwan periodically announced by the Council of Economic Planning and Development (CEPD). This information provides a reference for individuals and investors to make decisions. Since business cycle is fuzzy in nature, this study uses the fuzzy regression analysis method to establish a regression model in order to provide a reference for enterprises and decision-makers to make the right investments.