Economic Democracy: The Role of Consumer Sentiment in Shaping the American Economy in the 20th and 21st Centuries
Loading...
Authors
Turner, Thomas C.M.
Issue Date
2009
Type
Thesis
Language
en_US
Keywords
Alternative Title
Abstract
This project employs a two-pronged approach to the questions of consumer psychology and
consumer sentiment. Namely: what role do consumer psychology and expectations play in
shaping macro economic outcomes, how does consumer sentiment capture those psychologies
and expectations, how well does consumer sentiment capture those things, and how well does
consumer sentiment relate to the eventual economic outcomes? All of these questions arose out
of a recent reemergence of interest in forecasting consumer behavior in the midst of the sub-prime
mortgage and subsequent global economic crisis. Section I employs four historical case studies
to explore the questions of how consumer psychology has impacted economic outcomes. Each
case study represents a different collection of causes and results and represents a variety of
periods of economic volatility. Section 2 utilizes economic data and consumer sentiment data to
evaluate the effectiveness of using consumer sentiment to capture consumer expectations that
section I concludes are central to the shaping of macro economic outcomes. The project
ultimately concludes that while consumer psychologies are central to shaping economic
outcomes, consumer sentiment does a poor of job, in general of capturing those trends. In periods
of economic volatility however, the project concludes that consumer sentiment is much more
useful as an explanatory data set. In both scenarios though, consumer sentiment acts as a
relatively poor forecaster of larger economic outcomes.
Description
73 p.
Citation
Publisher
License
U.S. copyright laws protect this material. Commercial use or distribution of this material is not permitted without prior written permission of the copyright holder.