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Computing Consumer Sentiment in Germany via Social Media Data

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  • Karaman Örsal, Deniz Dilan
  • Sturm, Silke

Abstract

Survey-based consumer confidence indicators are mostly reported with a delay and are a result of time consuming and expensive consumer surveys. In this study, to measure the current consumer confidence in Germany, we develop an approach, in which we compute the consumer sentiment using public Tweets from Germany. To achieve this goal we develop a new sentiment score. To measure the consumer sentiment, we use text-mining tools and public Tweets from May 2019 to August 2020. Our findings indicate that there is a high correlation between the consumer confidence indicator based on survey data, and the consumer sentiment that we compute using data from Twitter platform. With our approach, we are even able to forecast the change in next month's consumer confidence.

Suggested Citation

  • Karaman Örsal, Deniz Dilan & Sturm, Silke, 2021. "Computing Consumer Sentiment in Germany via Social Media Data," Hamburg Discussion Papers in International Economics 7, University of Hamburg, Department of Economics.
    • Handle: RePEc:zbw:uhhhdp:7
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    References listed on IDEAS

    as
    1. Carroll, Christopher D & Fuhrer, Jeffrey C & Wilcox, David W, 1994. "Does Consumer Sentiment Forecast Household Spending? If So, Why?," American Economic Review, American Economic Association, vol. 84(5), pages 1397-1408, December.
    2. Sydney C. Ludvigson, 2004. "Consumer Confidence and Consumer Spending," Journal of Economic Perspectives, American Economic Association, vol. 18(2), pages 29-50, Spring.
    3. Shahid Shayaa & Sulaiman Ainin & Noor Ismawati Jaafar & Shamsul Bahri Zakaria & Seuk Wai Phoong & Wai Chung Yeong & Mohammed Ali Al-Garadi & Ashraf Muhammad & Arsalan Zahid Piprani, 2018. "Linking consumer confidence index and social media sentiment analysis," Cogent Business & Management, Taylor & Francis Journals, vol. 5(1), pages 1509424-150, January.
    4. Vuchelen, Jef, 2004. "Consumer sentiment and macroeconomic forecasts," Journal of Economic Psychology, Elsevier, vol. 25(4), pages 493-506, August.
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    Keywords

    consumer sentiment; consumer confidence; Twitter; sentiment analysis;
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