Journal of Economic Psychology2014-08-18 6:29 PM

Are Italian consumer confidence adjustments asymmetric?  A macroeconomic and psychological motives approach

Abstract

This paper estimates the determinants of Italian consumer confidence indicator (CCI) using time series methods. We find there exists a long-run relationship between CCI and its determinants when an important political event ‘operation clean hands’, captured by a dummy, is considered. Using the asymmetric error correction model (Enders & Siklos, 2001), we find that consumers respond asymmetrically to different types of disequilibrium error under threshold autoregressive (TAR) adjustment specification. These findings are consistent with the psychological bias approach (Bovi, 2009).

 

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http://dx.doi.org/10.1016/j.joep.2014.04.006

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Journal of Economic Psychology

Research in Economic Psychology and Behavioral Economics.The Journal aims to present research that will improve understanding of behavioral, especially socio- psychological, aspects of economic phenomena and processes.

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