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Stereotypes
Shleifer, Andrei; Bordalo, Pedro; Gennaioli, Nicola - National Bureau of Economic Research (NBER) - 2014
We present a model of stereotypes in which a decision maker assessing a group recalls only that group's most representative or distinctive types relative to other groups. Because stereotypes highlight differences between groups, and neglect likely common types, they are especially inaccurate...
Persistent link: https://www.econbiz.de/10010950773
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Stock Price Expectations and Stock Trading
Hurd, Michael D.; Rohwedder, Susann - National Bureau of Economic Research (NBER) - 2012
a gain show that people are more pessimistic than historical outcomes would suggest. Further, expectations of future … stock price increases apparently depend on old information, which would seem to be at odds with rational expectations in the … from the American Life Panel surveys from November 2008 to the present, we tracked high frequency changes in expectations …
Persistent link: https://www.econbiz.de/10011227946
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Expectations, Learning and Business Cycle Fluctuations
Eusepi, Stefano; Preston, Bruce - National Bureau of Economic Research (NBER) - 2008
This paper develops a theory of expectations-driven business cycles based on learning. Agents have incomplete knowledge … about how market prices are determined and shifts in expectations of future prices affect dynamics. In a real business cycle … consumption and leisure. Output volatility is comparable with a rational expectations analysis with a standard deviation of …
Persistent link: https://www.econbiz.de/10005575689
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Groupthink: Collective Delusions in Organizations and Markets
Benabou, Roland - National Bureau of Economic Research (NBER) - 2009
I develop a model of (individually rational) collective reality denial in groups, organizations and markets. Whether participants' tendencies toward wishful thinking reinforce or dampen each other is shown to hinge on a simple and novel mechanism. When an agent can expect to benefit from other's...
Persistent link: https://www.econbiz.de/10005588916
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Insider Trading, Stochastic Liquidity and Equilibrium Prices
Collin-Dufresne, Pierre; Fos, Vyacheslav - National Bureau of Economic Research (NBER) - 2012
We extend Kyle's (1985) model of insider trading to the case where liquidity provided by noise traders follows a general stochastic process. Even though the level of noise trading volatility is observable, in equilibrium, measured price impact is stochastic. If noise trading volatility is...
Persistent link: https://www.econbiz.de/10010581038
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Learning, Large Deviations and Rare Events
Benhabib, Jess; Dave, Chetan - National Bureau of Economic Research (NBER) - 2011
an endogenous variable from its rational expectations value. We show analytically that these large deviations can occur …
Persistent link: https://www.econbiz.de/10008855515
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What Drives Aggregate Investment?
Bachmann, Rüdiger; Zorn, Peter - National Bureau of Economic Research (NBER) - 2013
Using firm-level survey data for the West German manufacturing sector, this paper revisits the technology-driven business cycle hypothesis for the case of aggregate investment. We construct a survey-based measure of technology shocks to gauge their contribution to short-run investment...
Persistent link: https://www.econbiz.de/10010969200
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Price Rigidity: Microeconomic Evidence and Macroeconomic Implications
Nakamura, Emi; Steinsson, Jon - National Bureau of Economic Research (NBER) - 2013
We review recent evidence on price rigidity from the macroeconomics literature, and discuss how this evidence is used to inform macroeconomic modeling. Sluggish price adjustment is a leading explanation for large effects of demand shocks on output and, in particular, the effects of monetary...
Persistent link: https://www.econbiz.de/10010969239
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Informational Rigidities and the Stickiness of Temporary Sales
Nakamura, Emi; Steinsson, Jon; Anderson, Eric; … - National Bureau of Economic Research (NBER) - 2013
Frequent price changes do not imply a rapid response of prices to economic shocks if the price changes are based on old information. We study the extent of such information "stickiness" for temporary sales. Institutionally, we describe how and why temporary sales are "sticky plans" that are...
Persistent link: https://www.econbiz.de/10010969292
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High Frequency Identification of Monetary Non-Neutrality
Nakamura, Emi; Steinsson, Jon - National Bureau of Economic Research (NBER) - 2013
. Moreover, we find evidence of a "Fed information effect": FOMC announcements affect expectations not only about the evolution …
Persistent link: https://www.econbiz.de/10010969387