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Anticipating Future Expected Utility and Coordination Motives for Information Decisions in Networks

Author

Listed:
  • Antonio Jiménez-Martínez

    (Division of Economics, CIDE)

Abstract

This paper investigates empirically the relationship between inflation, inflation volatility and output growth in the case of México using monthly data over the period 1993-2011. Specifically a bivariate GARCH-M model is estimated to test the hypotheses that inflation rates are directly related to inflation volatility, and that inflation volatility affects negatively output growth. It is found that higher inflation rates are associated to higher inflation volatility which in turn affects negatively output growth. These results suggest that policies aimed to reduce inflation could have beneficial effects on growth through the specific channel of reducing inflation volatility.

Suggested Citation

  • Antonio Jiménez-Martínez, 2012. "Anticipating Future Expected Utility and Coordination Motives for Information Decisions in Networks," Working papers DTE 536, CIDE, División de Economía.
    • Handle: RePEc:emc:wpaper:dte536
    as

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    File URL: http://www.economiamexicana.cide.edu/RePEc/emc/pdf/DTE/DTE536.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Incomplete information; information acquisition; externalities; anticipation of expected utility; communication networks; coordination.;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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