Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/216575 
Year of Publication: 
2020
Series/Report no.: 
CESifo Working Paper No. 8179
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Expectations are highly relevant for macroeconomic dynamics. Yet, the empirical evidence about properties of corporate macroeconomic expectations is scarce. Using new survey data on quantitative growth expectations of firms in Germany, we show that expectations are highly dispersed. The degree of dispersion depends on firm size and on how important the general economy is for the business of firms, supporting theories of rational inattention. Firms seem to extrapolate from local economic conditions and business experiences to aggregate growth expectations. Differences in growth expectations are associated with differences in firms' investment and labor demand.
Subjects: 
GDP expectations
expectation heterogeneity
firm
ifo business tendency survey
JEL: 
D84
E32
Document Type: 
Working Paper
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