Measuring economic uncertainty is crucial for understanding investment decisions by individuals and firms. Macroeconomists increasingly rely on survey data on subjective expectations. An innovative approach to measure aggregate uncertainty exploits the rounding patterns in individuals' responses...

This article aims to build through the collection of inputs from prior research, regulatory input and practitioner's experience, a comprehensive definition of risk.Risk is not measurable uncertainty nor volatility. Risk is a three part concept: (1) risk is the potential that events may have an...

We analyze whether the timing of public information releases affects risk-sharing and pricing in a pure exchange economy. Information releases do not matter if agents have time additive preferences, homogeneous beliefs and access to complete markets. In the case of heterogeneity in agents'...

Uncertainty shapes the trajectory of business cycles and remains a central research topic in Macroeconomics. When studying the impact of uncertainty on the economy, economists use different uncertainty measures. While all indicators approximate uncertainty along some certain dimension, none of...

This paper investigates the effect of uncertainty on FDI flows into the Mexican manufacturing sector during the period 2007-2015. Using a panel of manufacturing subsectors, we estimate a model by System GMM that includes domestic and external factors, as well as idiosyncratic (i.e. that affect...

Knightian Uncertainty represents a situation in which it is no longer possible to form expectations about future events. We propose the first method to directly measure Knightian Uncertainty. Our approach relies on firm-level data and measures the share of firms that are not able to formalize...

Conventional wisdom suggests that optimism should be positively associated with risk taking. However, this has hardly been directly tested in the laboratory. In this paper, we report an experiment regarding risk perception and risk taking. Our data supports the hypothesis that two sufficient...

This research essay finds that, when consumer uncertainty exists regarding the valuation of intellectual property, unauthorised copying in the presence of network externalities can induce greater firm profits relative to the case without copying. Copying can be viewed as a conduit for...

This paper examines the value of direct communication to households about inflation and the uncertainty around inflation statistics. All types of information about inflation are effective at immediately managing inflation expectations, with information about outlooks being more effective and...

We study risky inter-temporal choice in a large random student sample (n=721) and a large rural sample (n=835) in Malawi. All respondents were exposed to the same 20 Multiple Choice Lists with a rapid elicitation method that facilitated the identification of near-future Certainty Equivalents of...