intermediate view: that both data and theory are useful for decision-making. We investigate optimal portfolio choice for an …

subjective probability distributions held by forecasters. We find that SPF forecasters summarize their underlying distributions … subsequent surveys. These findings, plus the inescapable fact that point forecasts reveal nothing about the uncertainty that … probabilistic expectations and derive measures of central tendency and uncertainty, as we do here …

in contractions but lends in expansions. Variations in uncertainty and expected growth generate trading volume due to … risk sharing. Higher uncertainty increases stock prices, risk premiums, volatility, wealth inequality and the dispersion of …

This paper introduces a formal definition and an experimental measurement of the concept of cognitive uncertainty …: people's subjective uncertainty about what the optimal action is. This concept allows us to bring together and partially … experiments and surveys tends to be insensitive to variation in probabilities, as in the classical probability weighting function …

shocks to aggregate uncertainty, I introduce a small, time-varying risk of economic disaster in a standard real business … cycle model. The paper establishes two simple theoretical results: first, when the probability of disaster is constant, the … quantities and asset prices in the spirit of Tallarini (2000). Second, shocks to the probability of disaster, which generate …

the present value of the flow of social benefits minus costs. But the real world is one of considerable uncertainty … discount rates that should be used to compute present values. The implications of uncertainty are complicated by the fact that … horizons. Correctly incorporating uncertainty in policy design is therefore one of the more interesting and important research …

The theoretical relationship between investment and uncertainty is ambiguous. This paper briefly surveys the insights … that theory has to offer and then runs a series of simple tests aimed at evaluating the empirical significance of various … theoretical effects. Our results from a panel of U.S. manufacturing firms indicate a negative effect of uncertainty on investment …