Economists and psychologists have each puzzled over the nature of decision making and the formation of expectations. Mainstream economists currently base their theory of expectation formation on the assumption of rationality Rationality implies unbiased forecasts and learning from past mistakes....

The U.S. coronavirus recession began in late February of 2020 and was over in two months. The rapid recovery was due to the Coronavirus Aid, Relief, and Economic Stability Act (CARES Act), a large fiscal stimulus program initiated in late March 2020, that was accompanied by a strong expansionary...

Many improvements have been proposed for the basic gravity model specification, most of which are confirmed by standard statistical tests due to the large number of observations often used to estimate such models. We use Monte Carlo experiments to examine situations in which features of models...