The rational expectations hypothesis is a bedrock of modern macroeconomics. It is often
combined with a strong, complementary hypothesis that all data about the state of the …

Economists, observers, and policy‐makers often emphasize the role of sentiment as a
potential driver of the business cycle. In this paper, we provide three contributions to this …

This paper analyzes how bounded rationality affects monetary and fiscal policy via an
empirically relevant enrichment of the New Keynesian model. It models agents' partial …

“Mervyn King may well have written the most important book to come out of the financial
crisis. Agree or disagree, King's visionary ideas deserve the attention of everyone from …

We propose a new strategy for dissecting the macroeconomic time series, provide a
template for the business-cycle propagation mechanism that best describes the data, and …

The stock market is volatile, as is aggregate economic activity, and the two are connected. At
least since Burns and Mitchell (1938), we know that measures of investment and production …

Making inferences about aggregate business cycles from regional variation alone is difficult
because of economic channels and shocks that differ between regional and aggregate …

Trust crisis in the financial sector and macroeconomic stability: a structural equation
modelling ap Page 1 Full Terms & Conditions of access and use can be found at https://www.tandfonline.com/action/journalInformation?journalCode=rero20 …

This paper combines a data-rich environment with a machine learning algorithm to provide
new estimates of time-varying systematic expectational errors (“belief distortions”) …

This chapter studies how incomplete information helps accommodate frictions in
coordination, leading to novel insights on the joint determination of expectations and …