No firm is an island? How industry conditions shape firms' expectations

• 成果类型: Article
• 署名作者: Andrade, Philippe; Coibion, Olivier; Gautier, Erwan; Gorodnichenko, Yuriy
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Boston; University of Texas System; University of Texas Austin; European Central Bank; Bank of France; National Bureau of Economic Research
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2021.05.006
• 发表日期: 2022
• 页码: 40-56
• 关键词: expectations; rational inattention; inflation

摘要

Using a survey of French manufacturing firms, we study how firms' expectations and actions are affected by both aggregate and industry-specific conditions. In response to industry-level shocks that have no aggregate effects, firms' aggregate expectations respond persistently. This is consistent with island models in which firms use the local prices they observe to make inferences about broader aggregate conditions. These patterns are related to observable characteristics of firms and the industries in which they reside. Finally, we extend the analysis to firms' expectations over their own future price changes and document how these respond to both industry and aggregate variation. (c) 2021 The Author(s). Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license ( http://creativecommons.org/licenses/by-nc-nd/4.0/ )