Uncertainty and Information Acquisition: Evidence from Firms and Households
American Economic Journal: Macroeconomics
vol. 16,
no. 2, April 2024
(pp. 375-405)
Abstract
We leverage the small open economy Switzerland as a testing ground for basic premises of macroeconomic models of endogenous information acquisition, using tailored surveys of firms and households. Firms and households perceiving a greater exposure to exchange rate fluctuations acquire more information about the exchange rate. Moreover, higher perceived costs of acquiring or processing information are associated with lower levels of information acquisition. Finally, an exogenous increase in the perceived uncertainty of the exchange rate increases firms' demand for a report about exchange rate developments, but not households'. Our findings inform the modeling of information frictions in macroeconomics.Citation
Mikosch, Heiner, Christopher Roth, Samad Sarferaz, and Johannes Wohlfart. 2024. "Uncertainty and Information Acquisition: Evidence from Firms and Households." American Economic Journal: Macroeconomics, 16 (2): 375-405. DOI: 10.1257/mac.20220047Additional Materials
JEL Classification
- D12 Consumer Economics: Empirical Analysis
- D22 Firm Behavior: Empirical Analysis
- D81 Criteria for Decision-Making under Risk and Uncertainty
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- D84 Expectations; Speculations
- E71 Macro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on the Macro Economy
- F31 Foreign Exchange
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