Believe it or not, it's all about beliefs!

Fabrice Collard, Patrick Fève et Alain Guay

This paper studies the impact of Higher Order Belief (HOB) shocks, representing shifts in agents' beliefs about others' beliefs, on macroeconomic outcomes. The dynamic causal effects of these shocks are identified by leveraging a combination of a proxy-VAR approach and DSGE-based instruments. Our findings suggest that HOB shocks are indeed a key driver of the business cycle and account for a sizeable share of the observed business cycle volatility. Finally, our identification approach ensures that these shocks are not confounded with other structural/fundamental shocks.

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Year of publication:	[2024]
Authors:	Collard, Fabrice ; Fève, Patrick ; Guay, Alain
Publisher:	Montréal, (Québec), Canada : Département des Sciences Économiques, Université du Québec à Montréal
Subject:	Higher Order Beliefs \| Business cycles \| proxy-VAR \| DSGE \| Theorie \| Theory \| Erwartungsbildung \| Expectation formation \| Konjunktur \| Business cycle \| Dynamisches Gleichgewicht \| Dynamic equilibrium

Extent:	1 Online-Ressource (circa 47 Seiten) Illustrationen
Series:	Document de travail. - [Montréal] : [ESG UQÀM, Département des sciences économiques, École des sciences de la gestion, Université du Québec à Montréal], ZDB-ID 3000176-6. - Vol. no. 2024, 03 (Mai 2024)
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Graue Literatur ; Non-commercial literature ; Arbeitspapier ; Working Paper
Language:	English
Other identifiers:	hdl:10419/301938 [Handle]
Classification:	C32 - Time-Series Models ; E32 - Business Fluctuations; Cycles
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10014635354