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2023-06Diskussionspapier DOI: 10.18452/26728
On FIRE, news, and expectations
dc.contributor.authorBorn, Benjamin
dc.contributor.authorEnders, Zeno
dc.contributor.authorMüller, Gernot J.
dc.date.accessioned2023-06-14T07:38:52Z
dc.date.available2023-06-14T07:38:52Z
dc.date.issued2023-06none
dc.identifier.issn2510-053X
dc.identifier.urihttp://edoc.hu-berlin.de/18452/27416
dc.description.abstractThe full-information rational expectations (FIRE) assumption is at the core of modern macroeconomics. We revisit recent evidence which rejects FIRE based on survey data. It relates forecast errors to news at different levels of aggregation. The evidence based on consensus forecasts testifies against the full-information assumption, the evidence based on data for individual forecasters against rational expectations. In contrast to earlier survey evidence that was largely dismissed as irrelevant, the recent evidence is likely to have a lasting impact for two reasons. First, the global financial crisis of 2007/08 has led to a certain uneasiness with the state of macro and a readiness to embrace new ideas. Second, the recent literature has put forward a number of promising alternative models of the expectation-formation process. We review these at the end of the paper.eng
dc.language.isoengnone
dc.publisherHumboldt-Universität zu Berlin
dc.rights.urihttp://rightsstatements.org/vocab/InC/1.0/
dc.subjectrational expectationseng
dc.subjectfull informationeng
dc.subjectFIREeng
dc.subjectcriseseng
dc.subjectsurvey dataeng
dc.subjectreaction to newseng
dc.subjectexpectations revolutioneng
dc.subject.ddc330 Wirtschaftnone
dc.titleOn FIRE, news, and expectationsnone
dc.typeworkingPaper
dc.identifier.urnurn:nbn:de:kobv:11-110-18452/27416-2
dc.identifier.doihttp://dx.doi.org/10.18452/26728
local.edoc.pages25none
local.edoc.type-nameDiskussionspapier
local.edoc.container-typeseries
local.edoc.container-type-nameSchriftenreihe
dc.identifier.zdb2916406-0
bua.series.nameWorking Papers of the Priority Programme 1859 – Experience and Expectation. Historical Foundations of Economic Behaviournone
bua.series.issuenumber42none
bua.departmentPhilosophische Fakultätnone
bua.series.editorNützenadel, Alexander
bua.series.editorStreb, Jochen

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