Direct Evidence on Sticky Information from the Revision Behavior of Professional Forecasters

Karlyn Mitchell and Douglas Pearce

Southern Economic Journal, 2017, vol. 84, issue 2, 637-653

Abstract: We provide evidence on the sticky‐information model of Mankiw and Reis () by examining how often individual professional forecasters revise their forecasts. We draw interest rate and unemployment rate forecasts from the monthly Wall Street Journal surveys. We find evidence that forecasters frequently leave forecasts unchanged but revise more often the larger the changes in the information set; additionally, the information sensitivity of revision frequencies increased after 2007. We also find that, on average, forecasters in our sample revise more frequently than found in previous research but that revised forecasts are not consistently more accurate.

Date: 2017
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https://doi.org/10.1002/soej.12236

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Working Paper: Direct Evidence on Sticky Information from the Revision Behavior of Professional Forecasters (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:wly:soecon:v:84:y:2017:i:2:p:637-653

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