New Keynesian theory identifies a set of principles central to the design and implementation of monetary policy. These principles rely on the ability of a central bank to manage expectations precisely, with policy prescriptions typically derived under the assumption of perfect information and...

Survey data on inflation expectations show that: (i) private sector forecasts and central bank forecasts are not fully aligned and (ii) private sector forecasters disagree about inflation expectations. To reconcile these two facts we introduce dispersed information in a New Keynesian model,...

We study how friendship shapes students' political opinions in a natural experiment. We use the indicator whether two students were exogenously assigned to a short-term \integration group", unrelated to scholar activities and dissolved before the school year, as instrumental variable for their...