use the heterogeneous-prior framework of Angeletos, Collard, and Dellas (2018) to accommodate confidence-driven business … cycle fluctuations. We show that financial frictions strongly amplify the response to confidence shocks - more strongly than …

sentiment (considering both confidence and uncertainty) and economic activity. Second, we review existing empirical measures of … sentiment, in particular consumer confidence, stock market volatility (SMV) and Economic Policy Uncertainty (EPU), on monthly … across countries, suggesting the existence of a global factor. Consumer confidence has the closest co-movement with economic …

. Between 1999 and 2008, U.S. non-bank MNCs cut their domestic employment by 1.9 million while increasing their foreign …

aggregate demand policies. In this paper we study the case of a central bank that ignores the presence of hysteresis when … bank that mistakes a demand shock for a supply shock, will produce permanent effects on output through their suboptimal … policies. Ex-post, the central bank will see an economy that resembles what they had forecast when designing their policies …