Application of the single index model for forecasting of the inland conveyances

In this paper the regression models used for description and forecasting of the inland rail passenger conveyances of the regions of Latvia were considered. Two estimation approaches were compared: the classical linear regression model and the single index model. Various tests for hypothesis of explanatory variables insignificance and model correctness have been lead, and the cross-validation approach has been carried out as well. The analysis has shown obvious preference of the single index model.