Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/283583 
Year of Publication: 
2023
Series/Report no.: 
ZEW Discussion Papers No. 23-062
Publisher: 
ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung, Mannheim
Abstract: 
Macroeconomic expectations of various economic agents are characterized by substantial cross-sectional heterogeneity. In this paper, we focus on expectations heterogeneity among professional forecasters. We first present stylized facts and discuss theoretical explanations for heterogeneous expectations. We then provide an overview of the empirical evidence supporting the different theories and point to directions for future research. Our literature review is complemented by empirical evidence based on the ZEW Financial Market Survey, covering the behavior of expectations heterogeneity during the recent surge in inflation in 2021 and 2022. A central finding is that differences in perceptions about the workings of the economy and heterogeneity in perceptions of the precision of new signals drive disagreement among professional forecasters. While the level of disagreement varies over the business cycle, differences in beliefs persist over time.
Subjects: 
disagreement
expectations
forecasts
rationality
survey data
JEL: 
C53
D83
D84
E17
E37
Document Type: 
Working Paper

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