|Title:||Essays on expectation formation, inflation dynamics, and monetary policy|
|Abstract:||This thesis presents five essays that compare rational-inattentiveness models and sticky-information models with rational-expectations models in several respects. Assumptions about rationality in both types of models are tested for, implications derived from rational-inattentiveness models are investigated, models' accuracies are evaluated, predicted information acquisition behavior is tested, and assumptions about information costs are inspected. Chapter 2 presents an empirical test of the two different concepts of rationality underlying rational-expectations models and rational-inattentiveness models. The results support the concept used in rational-inattentiveness models. Chapter 3 tests implications of rational-inattentiveness models with respect to forecasting macroeconomic variables. Rational-inattentiveness models predict a negative correlation between the amount of news and the forecast deviation. A negative correlation between news coverage and forecast deviation occurs empirically for inflation whereas a positive correlation is found in the context of unemployment. A comparison between the sticky-information and the sticky-price Phillips curve is made in Chapter 4. The overall results of the empirical performances allow no clear distinction between the two concepts. However, if one is predominantly interested in matching unconditional moments of inflation dynamics, sticky prices should be used. Researchers who focus on co-movements of inflation with demand will obtain better results applying sticky information. In Chapters 5 and 6, the information acquisition behavior predicted by rational-inattentiveness models and the assumptions about information costs in these models and in rational-expectations models are tested in an experimental environment. The overall results in Chapter 5 indicate that the prediction of information acquisition derived from rational-inattentiveness models cannot be rejected. The analysis in Chapter 6 shows that assumption about information costs of the rational-inattentiveness models cannot be rejected in contrast to the assumptions in rational-expectations models.|
|Appears in Collections:||Fachgebiet Applied Economics|
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