This paper studies the impact of Higher Order Belief 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 DSGEbased instruments. Our...

The proliferation of fake news poses significant challenges for policymakers and raises concerns about its potential impact on economic stability. This paper explores this question, focusing on the macroeconomic effects of technology related fake news in the US for the period 2007-2022....

The Great Recession, and the fiscal response to it, has revived interest in the size of fiscal multipliers. Standard business cycle models have difficulties generating multipliers greater than one. And they also fail to produce any significant asymmetry in the size of the multipliers over the...

The threats that misinformation poses to politics and public health are well documented, but the macroeconomic effects of fake news remain largely unexplored. This column highlights insights from recent research on the impact of fake news on economic stability. Leveraging a novel dataset, our...

Most macroeconomic models, both fully structural models as well as SVAR models, view economic outcomes as the product of a combination of endogenous and exogenous dynamic forces. In particular, the exogenous forces are generally modeled as a set of linearly independent dynamics processes. In...