Consumer Expectations
Micro Foundations and Macro Impact

Proposes a new comprehensive theory about how expectations are formed and how they shape the macro economy.

Richard Thomas Curtin (Author)

9780521181136, Cambridge University Press

Paperback, published 7 February 2019

360 pages
22.8 x 15.2 x 2 cm, 0.52 kg

'Unravelling the complexities of consumers' expectations is a perennial challenge for economists. Richard Curtin's Consumer Expectations provides fresh perspectives solidly grounded on real evidence from Michigan's influential consumer sentiment surveys. It will be an invaluable guide for anyone interested in how uncertainty and complexity play out in modern macroeconomies.' Michelle Baddeley, Director and Research Professor, Institute for Choice, University of South Australia

Richard Curtin has directed the University of Michigan's consumer sentiment surveys for more than four decades. His analyses of recent trends in consumer expectations are regularly covered in the worldwide press. In this book, Curtin presents a new theory of expectations. Whereas conventional theories presume that consumers play a passive role in the macro economy, simply reacting to current trends in incomes, prices, and interest rates, Curtin proposes a new empirically consistent theory. He argues that expectations are formed by an automatic process that utilizes conscious and nonconscious processes, passion and reason, information from public and private sources, and social networks. Consumers ultimately reach a decision that serves both the micro decision needs of individuals and reflects the common influence of the macro environment. Drawing on empirical observations, Curtin not only demonstrates the importance of consumer sentiment, but also how it can foreshadow the cyclical turning points in the economy.

1. Expectations and the macroeconomy
Part I. The Formation of Expectations: 2. Conventional theories of expectations
3. Private and public sources of economic information
4. Processing economic information
5. Affective influences on expectations
6. The construction of expectations
Part II. The Consumer and the Macroeconomy: 7. Expectations of macroeconomic cycles
8. The measurement of expectations
9. Tailored economic expectations
10. Economic expectations: paradigms and theories.

Subject Areas: Business & management [KJ], Microeconomics [KCC], Macroeconomics [KCB], Economics [KC], Psychology [JM], Sociology [JHB]