Applied Econometrics

Analysis of households' probability expectations

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    Motivation: Households' economic expectations (e.g. regarding their own economic situation, or regarding the inflation rate) are important for economic policy. In recent years, several central banks have started to collect households' economic expectations in the form of subjective probabilities. For example, households are asked to assess the probability that this year's inflation rate is between zero and two percent.


    Goal of the thesis: Conduct an empirical analysis of probability expectations data. Possible topics include the logical coherency of the stated probabilities, or the determinants of the probabilities (e.g., to what extent do socio-economic characteristics predict probability expectations). Econometrically, this topic involves tools for cross-section and panel data.


    Literature (starting point): Krüger, F., Pavlova, L. (2020): Quantifying Subjective Uncertainty in Survey Expectations. Working Paper. Link