CORDIS Project
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This project investigates how expectations are formed in macroeconomics and finance, focusing on the different methods individuals use to construct beliefs about inflation, stock returns, and unemployment. By employing surveys and experiments, it aims to understand the implications of these belief formation modes on ec…
Expectations are central in macroeconomics and finance. I propose to study modes of expectation formation in macro and finance: the ways in which expectations are constructed.
These modes can differ in the inputs used and in how these inputs are processed.
For instance, agents could consider relevant macroeconomic state variables and process this information through a developed mental model of the economy. A different approach could be based on spontaneous recall of easily accessible personal ex…
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