 Sentimental, Rational and Useful? A Directional Analysis of Consumer Sentiment Surveys in the US and the UKColin Ash (),
Joshy Easaw () and
Saeed Heravi ()
No em-dp2004-01, Economics Discussion Papers from Department of Economics, University of Reading Abstract: Consumer sentiments indices are widely used by business and government. Their potential for forecasting future economic activity is the subject of ongoing research. This paper aims to assess the directional accuracy and potential value to external users of households' sentiments data compiled by the Survey Research Centre at the University of Michigan for the USA, and by the GFK Organization for the UK. We find that these sentiments are predominantly rational, that is, the sign of these predictions is unbiased. Both US and UK households provide useful predictions of their own subsequent, subjective assessment of outcomes. Otherwise their value in predicting the direction of change is more ambiguous. Households appear to have a very specific concept in mind when forming expectations of their own financial position, and this concept differs between the two c countries. When predictions and retrospective assessments are evaluated against corresponding empirical outcomes, we find that US households have much the more coherent sentiments. Keywords: Consumer Sentiments; Survey Data; Forecast Evaluation; Directional Analysis (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:rdg:emxxdp:em-dp2004-01 Access Statistics for this paper More papers in Economics Discussion Papers from Department of Economics, University of Reading Contact information at EDIRC. |
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