Bontempi, Maria Elena ;
Frigeri, Michele ;
Golinelli, Roberto ;
Squadrani, Matteo
(2019)
Uncertainty, Perception and the Internet.
Bologna:
Dipartimento di Scienze economiche,
p. 93.
DOI
10.6092/unibo/amsacta/6254.
In: Quaderni - Working Paper DSE
(1134).
ISSN 2282-6483.
Full text available as:
Abstract
Macroeconomic uncertainty consists of three components: the unobservable, the heterogeneous and the “uncertain”. We are unaware of exactly when economic agents perceive uncertainty and which type of uncertainty interests them. This paper introduces and outlines a way of conducting large-scale data searches on the Web. We create the EURQ index of “economic uncertainty related queries” for both the USA and Italy. We show that the EURQ encapsulates agents’ need to gather more information during periods of uncertainty. This need either spontaneously arises in the case of macro-real and political uncertainty, or is induced by the media in the case of normative and financial uncertainty. This distinction is extremely important when trying to understand the immediate impact of fiscal policy uncertainty on economic variables, and how financial shocks can produce a significant short-term impact on economic activity. It is also helpful when trying to solve the identification and endogeneity issues encountered in the literature when assessing the role of uncertainty.
Abstract
Macroeconomic uncertainty consists of three components: the unobservable, the heterogeneous and the “uncertain”. We are unaware of exactly when economic agents perceive uncertainty and which type of uncertainty interests them. This paper introduces and outlines a way of conducting large-scale data searches on the Web. We create the EURQ index of “economic uncertainty related queries” for both the USA and Italy. We show that the EURQ encapsulates agents’ need to gather more information during periods of uncertainty. This need either spontaneously arises in the case of macro-real and political uncertainty, or is induced by the media in the case of normative and financial uncertainty. This distinction is extremely important when trying to understand the immediate impact of fiscal policy uncertainty on economic variables, and how financial shocks can produce a significant short-term impact on economic activity. It is also helpful when trying to solve the identification and endogeneity issues encountered in the literature when assessing the role of uncertainty.
Document type
Monograph
(Working Paper)
Creators
Keywords
macroeconomic uncertainty measurement; perception of uncertainty; Internet searches; Google Trends; finance-based indexes; survey-based indexes; news-based indexes
Subjects
ISSN
2282-6483
DOI
Deposit date
15 Oct 2019 10:24
Last modified
15 Oct 2019 10:24
URI
Other metadata
Document type
Monograph
(Working Paper)
Creators
Keywords
macroeconomic uncertainty measurement; perception of uncertainty; Internet searches; Google Trends; finance-based indexes; survey-based indexes; news-based indexes
Subjects
ISSN
2282-6483
DOI
Deposit date
15 Oct 2019 10:24
Last modified
15 Oct 2019 10:24
URI
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