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Unemployment expectations, excessive pessimism, and news coverage

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  • Garz, Marcel

Abstract

This study employs monthly survey data and information obtained from media content analyses to investigate the potential link between (negativity in) economic news coverage and the pessimism in German unemployment expectations. For the period from 2001 to 2009, time-series estimates do not indicate a link in the short-run, but the cumulative effects of repeated media coverage affect long-run attitudes. A single negative report has a long-term effect similar to that of a positive one, but the quantitative dominance of negative over positive news causes an asymmetric reaction in unemployment expectations, which promotes pessimism.

Suggested Citation

  • Garz, Marcel, 2013. "Unemployment expectations, excessive pessimism, and news coverage," Journal of Economic Psychology, Elsevier, vol. 34(C), pages 156-168.
  • Handle: RePEc:eee:joepsy:v:34:y:2013:i:c:p:156-168
    DOI: 10.1016/j.joep.2012.09.007
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    References listed on IDEAS

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    Cited by:

    1. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.
    2. Pablo Lavado & Gustavo Yamada, 2013. "Fear of Labor Rigidities – The Role of Expectations in Employment Growth in Peru," Working Papers 13-16, Centro de Investigación, Universidad del Pacífico.
    3. repec:spr:qualqt:v:51:y:2017:i:4:d:10.1007_s11135-016-0364-8 is not listed on IDEAS
    4. Beckmann Klaus B. & Dewenter Ralf & Thomas Tobias, 2017. "Can News Draw Blood? The Impact of Media Coverage on the Number and Severity of Terror Attacks," Peace Economics, Peace Science, and Public Policy, De Gruyter, vol. 23(1), pages 1-16, January.
    5. repec:zbw:rwirep:0528 is not listed on IDEAS
    6. Dewenter, Ralf & Dulleck, Uwe & Thomas, Tobias, 2016. "Does the 4th estate deliver? Towards more direct measure of political media bias," Working Paper 175/2016, Helmut Schmidt University, Hamburg.
    7. Antje Mertens & Miriam Beblo, 2016. "Self-Reported Satisfaction and the Economic Crisis of 2007–2010: Or How People in the UK and Germany Perceive a Severe Cyclical Downturn," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 125(2), pages 537-565, January.
    8. Marcel Garz, 2014. "Good news and bad news: evidence of media bias in unemployment reports," Public Choice, Springer, vol. 161(3), pages 499-515, December.
    9. Garz, Marcel, 2014. "Consumption, labor income uncertainty, and economic news coverage," MPRA Paper 56076, University Library of Munich, Germany.
    10. Pablo Lavado & Gustavo Yamada, 2013. "Fear of Labor Rigidities – The Role of Expectations in Employment Growth in Peru," Working Papers 13-17, Centro de Investigación, Universidad del Pacífico, revised Dec 2013.
    11. Deversi, Marvin, 2014. "Do Macroeconomic Shocks Affect Intuitive Inflation Forecasting? An Experimental Investigation," Ruhr Economic Papers 528, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    12. repec:kap:transp:v:45:y:2018:i:3:d:10.1007_s11116-016-9752-0 is not listed on IDEAS
    13. Choudhry, Taufiq & Hassan, Syed S., 2015. "Exchange rate volatility and UK imports from developing countries: The effect of the global financial crisis," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 39(C), pages 89-101.
    14. repec:eee:regeco:v:68:y:2018:i:c:p:172-190 is not listed on IDEAS
    15. Dewenter, Ralf & Linder, Melissa & Thomas, Tobias, 2018. "Can Media Drive the Electorate? The Impact of Media Coverage on Party Affiliation and Voting Intentions," Working Paper 179/2018, Helmut Schmidt University, Hamburg.
    16. Marvin Deversi, 2014. "Do Macroeconomic Shocks Affect Intuitive Inflation Forecasting? An Experimental Investigation," Ruhr Economic Papers 0528, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    17. Dewenter, Ralf & Linder, Melissa & Thomas, Tobias, 2018. "Can media drive the electorate? The impact of media coverage on party affiliation and voting intentions," DICE Discussion Papers 287, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    18. repec:hrv:faseco:33078973 is not listed on IDEAS

    More about this item

    Keywords

    Unemployment expectations; Economic news coverage; Pessimism;

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)

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