Do fiscal variables affect fiscal expectations? Experiments with real world and lab data

Michele Bernasconi (), Oliver Kirchkamp and Paolo Paruolo

Journal of Economic Behavior & Organization, 2009, vol. 70, issue 1-2, 253-265

Abstract: We generate observable expectations about fiscal variables through laboratory experiments using real world data from several European countries as stimuli. We compare a VAR model of expectations for data that is presented in a fiscal frame with one for neutrally presented data. We test the validity of the setup and find that participants understand the meaning of the fiscal variables, but also that their ability to perceive the correct characteristics of fiscal policy is limited. Expectations are consistent neither with rational nor with purely adaptive expectations, but instead follow an augmented-adaptive scheme.

Keywords: Experiments; Fiscal; policy; Expectations; Panel; data (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (5)

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Working Paper: Do fiscal variables affect fiscal expectations? Experiments with real world and lab data (2009)
Working Paper: Do fiscal variables affect fiscal expectations?: Experiments with real world and lab data (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:70:y:2009:i:1-2:p:253-265

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