This paper studies the dynamic effects of an uncertainty shock on firm expectations. We conduct a survey that confronts managers from a representative firm sample with a model-consistent uncertainty shock scenario. An exogenous increase in uncertainty significantly reduces managers' expected...

This paper constructs internationally consistent measures of macroeconomic uncertainty. Our econometric framework extracts uncertainty from revisions in data obtained from standardized national accounts. Applying our model to quarterly post-WWII real-time data, we estimate macroeconomic...

This paper leverages a novel survey among German senior government officials to investigate fiscal responses to monetary policy shocks. Using randomized vignette treatments, we present officials with scenarios of increased government interest costs and analyze their expected fiscal adjustments....

Business Tendency Surveys (BTS) continue to be an important source of timely information on business cycles in many countries. We address quality of economic survey data by uncovering the relation between unit non-response and participant characteristics on company respectively respondent level....

A sudden change in monetary policy happened in Switzerland on January 15th, 2015. The Swiss National Bank removed a lower exchange rate bound vis-à-vis the Euro. This unexpected change of regime induced a temporary uncertainty about future prices in foreign markets. We believe that this hampers...

Uncertainty shapes the trajectory of business cycles and remains a central research topic in Macroeconomics. When studying the impact of uncertainty on the economy, economists use different uncertainty measures. While all indicators approximate uncertainty along some certain dimension, none of...

Does increased policy uncertainty dampen investment plans of firms? We provide direct evidence on this question by examining the effects of an unexpectedly accepted and farreaching referendum in Switzerland in February 2014. The vote has put several economically relevant agreements between...

This paper investigates how inflation expectations evolve. In particular, we analyze the time-varying nature of the propensity to update expectations and its potential determinants. For this purpose we set up a flexible econometric model that tracks the formation of inflation expectations of...

In the process of economic development economies grow through various regimes, each characterized by different demographic-economic interactions. The changes in these interactions are key elements in different explanations of the escape from Malthusian stagnation. We employ time-varying vector...

We estimate demand, supply, monetary, investment and financial shocks in a VAR identified with a minimum set of sign restrictions on US data. We find that financial shocks are major drivers of fluctuations in output, stock prices and investment but have a limited effect on inflation. In a second...