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Non-Fundamental Expectations and Economic Fluctuations: Evidence from Professional Forecasts Author info | Abstract | Publisher info | Download info | Related research | Statistics Keen Meng Choy () (National University of Singapore)
Kenneth Leong
Anthony S. Tay
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It is theoretically possible that non-fundamental idiosyncratic shocks to agents’ rational expectations are a source of economic fluctuations. Studies using data on consumer and investor sentiment suggest that this is indeed a significant source of fluctuations. We present the results of a study that uses forecasts from professional forecasters to extract non-fundamental shocks to expectations. In contrast to previous studies, we show that non-fundamental expectations are not a significant source of output fluctuations.
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Paper provided by National University of Singapore, Department of Economics in its series Departmental Working Papers with number
wp0306.
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Date of creation: 2003Date of revision:
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Keywords: Non-fundamental expectations Sunspots Economic fluctuations Survey of Professional Forecasters Vector autoregressions Other versions of this item:
Find related papers by JEL classification: C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
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