This article presents further evidence on the hypothesis of news driven business cycles. I use a structural Vector Error Correction Model (VECM) approach to identify news shocks as in Beaudry and Lucke (BL, 2010). I document three facts: first, news shocks identified by BL are Granger causal for...

On several occasions, the 1980s witnessed non-Keynesian effects of fiscal contractions. Most notably, cuts in government spending in Ireland, Denmark and Germany are known to have coincided with increases in private consumption spending. Self-fulfilling expectations about the effects of...

The profitability of chartist trading rules on foreign exchange markets is still under debate. Since simple technical trading rules may not adequately capture the complex phenomenon of chartist trading, this study focuses on the prominent head-and-shoulder pattern as a representative trading...