Regulators charged with monitoring systemic risk need to focus on sentiment as well as narrowly defined measures of systemic risk. This chapter describes techniques for jointly monitoring the co-evolution of sentiment and systemic risk. To measure systemic risk, we use Marginal Expected...

This paper discusses the impact of a series of psychological phenomena on the U.S. response to COVID-19, focusing on forecasts of cases and deaths. The specific phenomena comprise unrealistic optimism bias, overconfidence, anchoring and adjustment, representativeness, motivated reasoning, and...