Determinants and effects of business expectations in Germany after 1980

In this project, we aim to contribute to the Priority Programme "Experience and Expectation: Historical Foundations of Economic Behaviour" by investigating the determinants and effects of business expectations in Germany after 1980. We will put a special focus on how institutional change and crises a) alter the way how expectations are formed, and b) impact on the pass-through of expectations into economic actions. Our principal data source is the EBDC Business Expectations Panel (BEP) of the LMU-ifo Economics & Business Data Center (EBDC) in Munich.

Publications:

Enders, Zeno/Hünnekes, Franziska/Müller, Gernot J. (2019): Monetary Policy Announcements and Expectations: Evidence from German Firms. Working Papers of the Priority Programme 1859 “Experience and Expectation. Historical Foundations of Economic Behaviour” No 10 (September), Berlin

Conrad, Christian/ Enders, Zeno/ Müller, Gernot: Die EZB setzt ihre Glaubwürdigkeit aufs Spiel, in: Ökonomenstimme (16 Dec. 2021). URL: https://www.oekonomenstimme.org/artikel/2021/12/die-ezb-setzt-ihre-glaubwuerdigkeit-aufs-spiel/

Enders, Zeno/Kleemann, Michael/Müller, Gernot (2021). Growth Expectations, undue Optimism, and short-run Fluctuations, in: The Review of Economics and Statistics 103, 905-921.

Conrad, C., Z. Enders, and A. Glas (2022). "The Role of Information and Experience for Households' Inflation Expectations." European Economic Review, 143, 104015.

Enders, Zeno/Hünnekes, Franziska/Müller, Gernot J. ( (2022). Firm Expectations and Economic Activity, in: Journal of the European Economic Association 20, 2396-2439.

Born, Benjamin/Enders, Zeno/Müller, Gernot/Niemann, Knut (2022). Firm expectations about production and prices: Facts, determinants, and effects, in: Ruediger Bachmann, Giorgio Topa, and Wilbert van der Klaauw (eds.), Handbook of Economic Expectations (Chapter 12), Elsevier.

Born, Benjamin/Enders, Zeno/Müller, Gernot/Menkhoff, Manuel/Niemann, Knut (June 2023). Firm Expectations and News: Micro v Macro. CEPR Discussion Paper No. 17768, Working Papers of the PP 1859, No. 43.

Conrad, Christian/Enders, Zeno (August 2023), "Die Prognosen der Europäischen Zentralbank", in: Ruperto Carola. Forschungsmagazin der Universität Heidelberg, Ausgabe 22, 25-31.

Born, Benjamin/Dovern, Jonas/Enders, Zeno (2023). Expectation Dispersion, Uncertainty, and the Reaction to News, in: European Economic Review 154, 104440.

Work in Progress:

Roberto A. De Santis and Christopher Zuber (2021). Firm Investment During Recessions and Recoveries.

News and upcoming events

Why did the passbook vanish in the US but survived in Germany during stagflation? Find out here in Sebastian Knake's newest working paper, no. 46 of the series.

In a new Working Paper, Alexander Foltas investigates the efficient integration of forecasters’ narratives into business cycle forecasts. Find it here!

In the Frankfurter Allgemeine Zeitung, Laetitia Lenel traces the profound change in economic forecasting methods and their function throughout the 20th century. The article can be found here.

How have economic narratives structured economic imaginations and shaped econ. decision-making? The JMEH forum section on "Economic Narratives," edited by Alexander Nützenadel and Laetitia Lenel, offers some answers. Find it here.

In an article for the Heidelberg University magazine RUPERTO CAROLA, Christian Conrad and Zeno Enders discuss the challenges of inflation forecasting and possible lessons for the European Central Bank. Find the article here!

Laetitia Lenel was recently awarded the 2023 Otto-Hintze-Nachwuchspreis for her dissertation "The Hopeful Science. A Transatlantic History of Business Forecasting, 1920-1960". Congratulations!

Jochen Streb, Andreas Neumayer, and Sibylle Lehmann-Hasemeyer have a new publication out in the Journal of Banking & Finance titled "Heterogeneous inflation and deflation experiences and savings decisions during German industrialization". Find it here!

In our latest working paper, Alexander Foltas proposes a new approach for uncovering business cycle reports’ priorities and relating them to economic fluctuations. Find it here!

In our latest working paper, Benjamin Born, Zeno Enders, Manuel Menkhoff, Gernot Müller, and Knut Niemann study "how firm expectations adjust to news while accounting for a) the heterogeneity of news and b) the heterogeneity of firms." Find it here!

The latest edition of History of Political Economy deals with the topic of "Narrative in Economics: A New Turn on the Past." In her contribution to the volume, Laetitia Lenel explores the history of scenario drafting at the IMF in the 1970s and 1980s. Find it here!

In our latest working paper, Benjamin Born, Zeno Enders, and Gernot J. Müller revisit recent survey based evidence that challenges the FIRE (full-information rational expectations) assumption. They argue that this recent evidence is likely to be of lasting impact in adjusting models of the expectation-formation process. Find it here!

In the latest edition of the Jahrbuch für Wirtschaftsgeschichte (Economic History Yearbook), Ulrich Fritsche and Mark Spoerer preside over a series of contributions concerning the use of digital methods in history. This volume stems from an SPP-Workshop "Digital Methods in History and Economics" which took place last October. Find it here!

In our latest working paper, Sebastian Knake investigates the history of econometric models (and their variables) of the US savings deposit market from the 1960s to 1980s, and further interrogates the ways in which the demands for such models varied throughout this period. Read it here!

Sebastian Knake's essay on the history of the Spareckzins and its determination during the stagflation period (1967-83) was recently published in the April edition of the Vierteljahrschrift für Sozial- und Wirtschaftsgeschichte. Find it here!

Laetitia Lenel was awarded the Friedrich-Lütge-Preis of the German Society for Social and Economic History for her outstanding dissertation on the history of business forecasting. Congratulations!

In our latest working paper, David Barkhausen and Sebastian Teupe trace the history and construction of the contemporary understanding of the German inflation trauma. The following question serves as a point of departure: is this contemporary understanding as old as its historical point of reference (the experience of hyperinflation in 1923)? Finding evidence to the contrary, the authors' research helps to clarify origins and political uses of today's popular memory. Find the paper here.

In our latest working paper, Jonas Dovern, Alexander Glas, and Geoff Kenny assess the value of survey-based density expectations as compositional data when testing either for heterogeneity in density forecasts across different groups of agents or for changes over time. Find it here.

In our latest working paper, Jonas Dovern considers the utility of data from an online survey of German consumer expectations as an indicator of macroeconomic expectation uncertainty. Find it here.

In our newest working paper, Ulrike Malmendier considers the ways in which lived-experiences play a role in shaping our economic decision-making and beliefs, both among regular people and economic experts alike. Find it here.

In light of the ECB's recent announcement that it will improve its forecasting models, Christian Conrad points to the limitations of inflation forecasts in the FAZ.

Sebastian Teupe's book on the German inflation between 1914 and 1923 is out. Find it here!

In light of the current vacancies in the German Council of Economic Advisers, Lino Wehrheim takes a look at past debates about appointments to the Council in the FAZ.

In our newest Working Paper, Lino Wehrheim traces 70 years of Federal German public discourse via a Topic Modeling/Sentiment Perspective of Der Spiegel. Find it here.

The workshop "Economic Narratives in Historical Perspective" has taken place from April 28-29 at GHI London. For more details click here.

In our newest Working Paper, Sibylle Lehmann-Hasemeyer, Andreas Neumayer and Jochen Streb consider the heterogeneity of savers' inflation expectations during the German industrialization. Get it here!

Lino Wehrheim's article "The Sound of Silence. On the (In)visibility of Economists in the Media" has been published in the Vierteljahrschrift für Sozial- und Wirtschaftsgeschichte. Find it here.

You can find older announcements in our news archive.