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Abstract

We provide direct evidence on the sticky information model of Mankiw and Reis 2002 by examining how frequently individual professional forecasters revise their forecasts. We draw interest rate and unemployment rate forecasts from the monthly Wall Street Journal surveys conducted between 2003 and 2013. Consistent with the sticky information model we find that forecasters frequently leave their forecasts unrevised but find evidence that revision frequency increases following larger changes in the information set. We also find revision frequencies became more sensitive to new information after the 2008 financial crisis but only weak evidence that frequent revisers forecast more accurately.



Item Type: MPRA Paper -

Original Title: Direct Evidence on Sticky Information from the Revision Behavior of Professional Forecasters-

English Title: Direct Evidence on Sticky Information from the Revision Behavior of Professional Forecasters-

Language: English-

Keywords: Expectations, Sticky Information, Survey Forecasts-

Subjects: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy-





Author: Mitchell, Karlyn

Source: https://mpra.ub.uni-muenchen.de/66172/







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