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News and uncertainty about COVID-19: Survey evidence and short-run economic impact.


ABSTRACT: A tailor-made survey documents consumers' perceptions of the US economy's response to a large shock: the advent of the COVID-19 pandemic. The survey ran at a daily frequency between March 2020 and July 2021. Consumer's perceptions regarding output and inflation react rapidly. Uncertainty is pervasive. A business-cycle model calibrated to the consumers' views provides an interpretation. The rise in household uncertainty accounts for two-thirds of the fall in output. Different perceptions about monetary policy can explain why consumers and professional forecasters agree on the recessionary impact, but have sharply divergent views about inflation.

SUBMITTER: Dietrich AM 

PROVIDER: S-EPMC8827064 | biostudies-literature |

REPOSITORIES: biostudies-literature

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