News and Uncertainty about COVID-19: Survey Evidence and Short-Run Economic Impact

Alexander Dietrich, Keith Kuester, Gernot Müller and Raphael Schoenle

No 20-12R, Working Papers from Federal Reserve Bank of Cleveland

Abstract: A tailor-made survey documents consumer perceptions of the U.S. economy’s response to a large shock: the advent of the COVID-19 pandemic. The survey ran at a daily frequency between March 2020 and July 2021. Consumer perceptions regarding output and inflation react rapidly. Uncertainty is pervasive. A business-cycle model calibrated to the consumer views provides an interpretation. The rise in household uncertainty amplifies the pandemic recession by a factor of three. Different perceptions about monetary policy can explain why consumers and professional forecasters agree on the recessionary impact, but have sharply divergent views about inflation.

Keywords: consumer expectations; survey; COVID-19; large shock; monetary policy; uncertainty (search for similar items in EconPapers)
JEL-codes: C83 E43 E52 (search for similar items in EconPapers)
Pages: 45
Date: 2020-04-09, Revised 2021-12-22
New Economics Papers: this item is included in nep-cba, nep-dge, nep-mac, nep-mon and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (37)

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Related works:
Journal Article: News and uncertainty about COVID-19: Survey evidence and short-run economic impact (2022)
Working Paper: News and uncertainty about COVID-19: Survey evidence and short-run economic impact (2021)
Working Paper: News and uncertainty about COVID-19: Survey evidence and short-run economic impact (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwq:87736

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DOI: 10.26509/frbc-wp-202012r

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