【Macro Seminar】Diagnostic Expectations and Open Economy Business Cycles
研討會日期 : 2023-05-30
時間 : 14:30
主講人 : Professor Seunghoon Na
地點 : B110
演講者簡介 : Professor Seunghoon Na received his Ph.D. from Columbia University in 2018. He is currently an Assistant Professor of Economics at Purdue University. His research interests are Macroeconomics, International Money and Finance, and Behavioral Macroeconomics.
演講摘要 : In this paper, we integrate diagnostic expectations (DE) of decision-makers, which are based on the psychological concept of "representativeness heuristic" (Kahneman and Tversky, 1972), into a dynamic open macro model. We investigate how DE influences the dynamic behavior of consumption, investment, and trade balance, comparing to the Rational Expectations (RE) benchmark. Additionally, we estimate the DE model to determine the degree of diagnosticity, predict the sources of business cycles, and identify similarities and differences compared to the estimated RE model. Furthermore, we explore how DE might offer potential remedies in cases where the RE model is misspecified.