firms invest and hire less. The higher uncertainty reduces agents' confidence and further discourages economic activity. We …

). Ambiguity aversion is described by recursive multiple priors preferences that capture agents' lack of confidence in probability … using first-order approximations. In our estimated medium-scale DSGE model, a loss of confidence about productivity works … like 'unrealized' bad news. Time-varying confidence emerges as a major source of business cycle fluctuations …

This paper presents a model of the macroeconomy that reformulates what I take to be two important ideas from Keynes …

confidence innovations. Once we control for their low-frequency effect, we find little statistically or economically significant …

confidence shock. Lack-of-confidence shocks play a central role in generating jobless recoveries, for fundamental shocks, such as …

the most suffered the biggest loss in confidence in institutions, particularly in trust in government and the financial … sector. Finally, analysis of several repeated cross-sections of confidence within U.S. states yields similar qualitative …