scholarly journals Information Rigidity and the Expectations Formation Process: A Simple Framework and New Facts

2012 ◽  
Author(s):  
Olivier Coibion ◽  
Yuriy Gorodnichenko
Keyword(s):  
Formation Process ◽  
Expectations Formation ◽  
Information Rigidity

scholarly journals Information Rigidity and the Expectations Formation Process: A Simple Framework and New Facts

2015 ◽  
Vol 105 (8) ◽  
pp. 2644-2678 ◽  
Author(s):  
Olivier Coibion ◽  
Yuriy Gorodnichenko
Keyword(s):  
Formation Process ◽  
Rational Expectations ◽  
Imperfect Information ◽  
State Dependence ◽  
Expectations Hypothesis ◽  
Economic Significance ◽  
Expectations Formation ◽  
Information Models ◽  
International Data ◽  
Information Rigidity

We propose a new approach to test the full-information rational expectations hypothesis which can identify whether rejections of the null arise from information rigidities. This approach quantifies the economic significance of departures from the null and the underlying degree of information rigidity. Applying this approach to US and international data of professional forecasters and other agents yields pervasive evidence consistent with the presence of information rigidities. These results therefore provide a set of stylized facts which can be used to calibrate imperfect information models. Finally, we document evidence of state-dependence in the expectations formation process. (JEL C53, D83, D84, E13, E31, E37)

scholarly journals Information Rigidity and the Expectations Formation Process: A Simple Framework and New Facts

2010 ◽  
Author(s):  
Olivier Coibion ◽  
Yuriy Gorodnichenko
Keyword(s):  
Formation Process ◽  
Expectations Formation ◽  
Information Rigidity

scholarly journals Information Rigidity and the Expectations Formation Process: A Simple Framework and New Facts

2012 ◽  
Vol 12 (296) ◽  
pp. 1 ◽  
Author(s):  
Olivier Coibion ◽  
Yuriy Gorodnichenko ◽  
◽  
Keyword(s):  
Formation Process ◽  
Expectations Formation ◽  
Information Rigidity

Expectations and Preferences in British General Elections

1994 ◽  
Vol 88 (2) ◽  
pp. 371-383 ◽  
Author(s):  
Richard Nadeau ◽  
Richard G. Niemi ◽  
Timothy Amato
Keyword(s):  
Great Britain ◽  
Formation Process ◽  
General Election ◽  
Bandwagon Effect ◽  
Expectations Formation ◽  
Before And After ◽  
General Elections ◽  
Rapid Adjustment ◽  
Economic Expectations ◽  
Using Data

We address two questions: How do people form their expectations about the likely winner of the next general election? and What are the links between expectations and votes? Using data collected by the Gallup organization in Great Britain, we find that the expectations formation process (1) has a significant inertia component but also a rapid adjustment to current information; (2) reflects voters' ability to translate economic expectations into political forecasts; and (3) is “time-bounded,” possessing special characteristics immediately before and after a general election. The analysis also confirms the existence of a small bandwagon effect, whereby expectations that one party will win inflate that party's vote. The ability of voters to make reasonable forecasts without being unduly influenced by their own preferences suggests that under normal circumstances voters are expressing real preferences and not simply following the crowd.

Sovereign credit news and disagreement in expectations about the exchange rate: evidence from Brazil

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Diego Silveira Pacheco de Oliveira ◽  
Gabriel Caldas Montes
Keyword(s):  
Exchange Rate ◽  
Financial Markets ◽  
Formation Process ◽  
Credit Rating ◽  
Content Type ◽  
Sovereign Credit ◽  
Expectations Formation ◽  
Exchange Rate Expectations ◽  
The Exchange Rate ◽  
Practical Implications

PurposeCredit rating agencies (CRAs) are perceived as highly influential in the financial system since their announcements can affect several players in the financial markets, from big private financial and non-financial companies and their financial markets experts to sovereign states. In this sense, this study investigates whether sovereign credit news issued by CRAs (measured by comprehensive credit rating (CCR) variables) affect the uncertainties about the exchange rate in the future (captured by the disagreement about exchange rate expectations). The study is relevant once there is evidence indicating that CRAs' assessments are responsible for affecting international capital flows and, thus, sovereign rating changes can affect the expectations formation process regarding the exchange rate. In addition, there is evidence indicating that the disagreement about exchange rate expectations affects the disagreement about inflation expectations, which brings consequences to policymakers.Design/methodology/approachThe dependent variables are the disagreement in expectations about the Brazilian exchange rate for different forecast horizons, 12, 24 and 36 months ahead and the first principal component of theses series. On the other hand, the CCR variables are built upon the long-term foreign-currency Brazilian bonds ratings, outlooks and credit watches provided by the main CRAs. Estimates are obtained using ordinary least squares (OLS) and generalized method of moments (GMM); a dynamic analysis is performed using vector-autoregressive (VAR) through impulse-response functions.FindingsNegative (positive) sovereign credit news, given by a rating downgrade (upgrade) and/or a negative (positive) outlook/watch status, increase (decrease) the disagreement about exchange rate expectations. This result holds for all disagreement and CCR variables.Practical implicationsThe study brings practical implications to both private agents (mainly financial market experts) and policymakers. An important practical implication of the study concerns the ability of CRAs to affect the expectations formation process of financial market experts regarding the future behavior of the exchange rate. When a CRA issues a signal of improvement in a country's sovereign rating, this signal reflects the perception of improvement in macroeconomic fundamentals and reduction of uncertainties about the country's ability to honor its financial obligations, which therefore, facilitates the expectations formation process, causing a reduction in the disagreement about the exchange rate expectations. With respect to the consequences for policymakers, they will have more difficulty in guiding expectations in a country with a worse sovereign risk rating, where agents have difficulties in forming expectations and the disagreement in expectations is greater.Originality/valueThe study is the first to analyze the impact of CRAs' announcements on the disagreement about exchange rate expectations. Moreover, it connects the literature that investigates the effects of sovereign credit news on the economy with the literature that examines the main determinants of disagreement in expectations about macroeconomic variables.

scholarly journals Economic Science and Evolution of Economic Agents’ Expectations Formation Process

2015 ◽  
Vol 11 (19) ◽  
Author(s):  
Valeriy Shlychkov ◽  
Diana Nestulaeva
Keyword(s):  
Formation Process ◽  
Economic Science ◽  
Economic Agents ◽  
Expectations Formation

Formation process of periodic non-conservative antiphase boundary structure in L-Pd5Ce

1990 ◽  
Vol 48 (4) ◽  
pp. 162-163
Author(s):  
Masaru Itakura ◽  
Noriyuki Kuwano ◽  
Kensuke Oki
Keyword(s):  
Formation Process ◽  
Domain Size ◽  
Antiphase Boundary ◽  
Boundary Structure ◽  
Temperature Phase ◽  
Arc Melting ◽  
Iced Water ◽  
Antiphase Domains ◽  
Low Temperature Phase ◽  
Degree Of Order

The low temperature phase of Pd5Ce (L-Pd5Ce) has a one-dimensional long period superstructure (1D-LPS) derived from Ll2. The periodic antiphase boundaries (APBs) are parallel to (110) planes and have a shift vector of 1/2[110]. Hereafter, the indices are referred to the basic lattices of Ll2 As insertion of the APB causes a change in composition, such an APB is called “non-conservative”. Then, a domain size M depends upon the Ce concentration in the alloy. It was found that M increases also with temperature. The temperature dependency of M is attributed to a change of the degree of order within the antiphase domains. In this work, morphology of the non-conservative APBs is observed to clarify the formation process of the 1D-LPS.The alloy of Pd-16.7 at%Ce was prepared by arc melting in argon atmosphere. Disc specimens made from the alloy ingot were first held at 985 K for 260 ks and quenched in iced water to obtain the state of M=∞ or Ll2, followed by annealing for various lengths of time. The annealing temperature was 873 K where the equilibrium value for M is about 3 in unit of (110) lattice spacing of Ll2. Observation was carried out using microscopes JEM-2000FX, JEM-4000EX (HVEM Lab., Kyushu Univ.) and JEM-2000EX (Dept. of Mater. Sci. Tech., Kyushu Univ.).

Sign in / Sign up

Export Citation Format

Share Document