Inter-subject Correlation While Listening to Minimalist Music: A Study of Electrophysiological and Behavioral Responses to Steve Reich's Piano Phase

Musical minimalism utilizes the temporal manipulation of restricted collections of rhythmic, melodic, and/or harmonic materials. One example, Steve Reich's Piano Phase, offers listeners readily audible formal structure with unpredictable events at the local level. For example, pattern recurrences may generate strong expectations which are violated by small temporal and pitch deviations. A hyper-detailed listening strategy prompted by these minute deviations stands in contrast to the type of listening engagement typically cultivated around functional tonal Western music. Recent research has suggested that the inter-subject correlation (ISC) of electroencephalographic (EEG) responses to natural audio-visual stimuli objectively indexes a state of “engagement,” demonstrating the potential of this approach for analyzing music listening. But can ISCs capture engagement with minimalist music, which features less obvious expectation formation and has historically received a wide range of reactions? To approach this question, we collected EEG and continuous behavioral (CB) data while 30 adults listened to an excerpt from Steve Reich's Piano Phase, as well as three controlled manipulations and a popular-music remix of the work. Our analyses reveal that EEG and CB ISC are highest for the remix stimulus and lowest for our most repetitive manipulation, no statistical differences in overall EEG ISC between our most musically meaningful manipulations and Reich's original piece, and evidence that compositional features drove engagement in time-resolved ISC analyses. We also found that aesthetic evaluations corresponded well with overall EEG ISC. Finally we highlight co-occurrences between stimulus events and time-resolved EEG and CB ISC. We offer the CB paradigm as a useful analysis measure and note the value of minimalist compositions as a limit case for the neuroscientific study of music listening. Overall, our participants' neural, continuous behavioral, and question responses showed strong similarities that may help refine our understanding of the type of engagement indexed by ISC for musical stimuli.

Asymmetric Attention

We document that the expectations of households, firms, and professional forecasters in standard surveys simultaneously extrapolate from recent events and underreact to new information. Existing models of expectation formation, whether behavioral or rational, cannot account for these observations. We develop a rational theory of extrapolation based on limited attention, which is consistent with this evidence. In particular, we show that limited, asymmetric attention to procyclical variables can explain the coexistence of extrapolation and underreactions. We illustrate these mechanisms in a microfounded macroeconomic model, which generates expectations consistent with the survey data, and show that asymmetric attention increases business cycle fluctuations. (JEL C53, D83, D84, E23, E27, E32)

Learning in the Oil Futures Markets: Evidence and Macroeconomic Implications

Using oil futures, we examine expectation formation and how it alters the macroeconomic transmission of shocks. Our empirical framework, where investors learn about the persistence of oil-price movements, successfully replicates the fluctuations in oil-price futures since the late 1990s. By embedding this learning mechanism in an estimated model, we document that an increase in the persistence of TFP-driven fluctuations in oil demand largely accounts for investors’ perceptions that oil-price movements became increasingly permanent during the 2000s. Learning alters the macroeconomic impact of shocks, making the responses time-dependent and conditional on perceptions of shocks’ likely persistence.

Learning in a double-phase cobweb model

In this paper, we study a class of markets, among which we can mention agricultural and energy markets, characterized by seasonality, i.e., in which demand and/or supply conditions cyclically alternate with a precise and known periodicity. We propose a new theoretical framework based on a cobweb model with adaptive expectations, accordingly modified to be consistent with market’s seasonality. The model, consisting in a second-order non-autonomous difference equation, is investigated with the aim of understanding how the periodical nature of the market together with the agents’ expectation formation mechanism affects the resulting dynamics. We analytically prove the emergence of dynamical scenarios that are missing in the classic cobweb model for non-seasonal markets, such as quasi-periodic dynamics and an ambiguous role on stability of the expectation weight. Finally, we discuss their economic rationale with the help of numerical simulations. In such a peculiar economic framework, agents’ learning plays a key role to explain the dynamical properties of economic observables.

Krishna Bharadwaj on the Role of Expectations in Economic Theory

In this article, I discuss the approach favoured by Bharadwaj, in the tradition of classical political economy and of Sraffa, where the focus is on those factors that are observed as opposed to the subjective factors that are neither observable nor measurable. Unlike neoclassical theory, with this approach, there is no room for concepts such as ‘utility’ and the like; insofar as ‘expectations’ are conceived as subjective, non-observable entities, they are not attributed with an explanatory role in the theory of prices and distribution. Moreover, since expectation formation is seen as the effect rather than cause of behaviour, the focus shifts to those social, historical and contingent elements that seem to have a better explanatory force. In this approach, what matters is the persistence of forces leading the system to tend, in the long period, towards a position of rest. JEL Codes: B2, B31

STATE-DEPENDENT FORMATION OF INFLATION EXPECTATIONS

The learning-from-experience model of Malmendier and Nagel [(2016) Quarterly Journal of Economics 131, 53–87] successfully reproduces the heterogeneity in inflation expectations across age groups. However, inflation expectations presumably depend on not only age and experience but also inflation regime. Therefore, this paper proposes an extended learning-from-experience model, in which expectation formation depends on inflation regime. Estimating the model with US data, I find that when inflation is higher and more volatile, households place more weight on recent data when making private forecasts. Moreover, in this regime, households rely more heavily on private forecasts than on public information.

Inter-Subject Correlation during New Music Listening: A Study of Electrophysiological and Behavioral Responses to Steve Reich’s Piano Phase

Musical minimalism utilizes the temporal manipulation of restricted collections of rhythmic, melodic, and/or harmonic materials. One example, Steve Reich’s Piano Phase, offers listeners readily audible formal structures containing unpredictable events at local levels. Pattern recurrences may generate strong expectations which are violated by small temporal and pitch deviations. A hyper-detailed listening strategy prompted by these minute deviations stands in contrast to the type of listening engagement typically cultivated around functional tonal Western music. Recent research has suggested that the inter-subject correlation (ISC) of electroencephalographic (EEG) responses to natural audio-visual stimuli objectively indexes a state of “engagement”, demonstrating the potential of this approach for analyzing music listening. But can ISCs capture engagement with minimal music, which features less obvious expectation formation and has historically received a wide range of reactions? To approach this question, we collected EEG and continuous behavioral (CB) data while 30 adults listened to an excerpt from Steve Reich’s Piano Phase, as well as three controlled manipulations and a popular-music remix of the work. Our analyses reveal that EEG and CB ISC are highest for the remix stimulus and lowest for our most repetitive manipulation. In addition, we found no statistical differences in overall EEG ISC between our most musically meaningful manipulations and Reich’s original piece. We also found that aesthetic evaluations corresponded well with overall EEG ISC. Finally we highlight co-occurrences between stimulus events and time-resolved EEG and CB ISC. We offer the CB paradigm as a useful analysis measure and note the value of minimalist compositions as a limit case for studying music listening using EEG ISC. We show that ISC is less effective at measuring engagement with this minimalist stimulus than with popular music genres and argue that this may be due to a difference between the type of engagement measured by ISC and the particular engagement patterns associated with minimalism.