Information Frictions among Firms and Households

Sebastian Link, Andreas Peichl, Christopher Roth and Johannes Wohlfart ()
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Johannes Wohlfart: Department of Economics and CEBI, University of Copenhagen, CES ifo, Danish Finance Institute

No 140, ECONtribute Discussion Papers Series from University of Bonn and University of Cologne, Germany

Abstract: We survey samples of German firms and households to document novel stylized facts about the extent of information frictions among the two groups. First, firms’ expecta-tions about macroeconomic variables are closer to expert forecasts and less dispersed than households’, consistent with higher information frictions among households. Second, the degree of dispersion and the distance from expert forecasts varies more across groups of households than across groups of firms. Third, firms update their policy rate expectations less than households when provided with an expert forecast, consistent with holding stronger priors. Our results have implications for modeling choices, macroeconomic dynamics, and policies.

Keywords: Information frictions; expectation formation; firms; households; interest rates (search for similar items in EconPapers)
JEL-codes: D83 D84 E71 (search for similar items in EconPapers)
Pages: 84 pages
Date: 2022-01
New Economics Papers: this item is included in nep-mac
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https://www.econtribute.de/RePEc/ajk/ajkdps/ECONtribute_140_2022.pdf First version, 2022 (application/pdf)

Related works:
Journal Article: Information frictions among firms and households (2023)
Working Paper: Information Frictions among Firms and Households (2022)
Working Paper: Information Frictions among Firms and Households (2021)
Working Paper: Information Frictions among Firms and Households (2021)
Working Paper: Information Frictions among Firms and Households (2021)
Working Paper: Information Frictions among Firms and Households (2021)
Working Paper: Information Frictions among Firms and Households (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ajk:ajkdps:140

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