What Makes a Good Economy? Evidence from Public Opinion Surveys

17 Pages Posted: 9 May 2014

See all articles by Darren P. Grant

Darren P. Grant

Sam Houston State University - College of Business Administration - Department of Economics and International Business

Multiple version iconThere are 2 versions of this paper

Date Written: July 2014

Abstract

Analysis of 35 years of previously unstudied survey data shows how the American public evaluates the health of the macroeconomy. Survey responses are multidimensional, distinct from indexes of “consumer sentiment,” and based mostly on genuine perceptions of economic conditions, not media reports of economic statistics. As such, they contain unique information about current and future values of these statistics, particularly consumption growth, a longstanding focus of the literature. Both “intangibles” and macroeconomic fundamentals explain substantial variation in the survey data; the public equates 2 to 5 percentage points of inflation with 1 percentage point of unemployment.

Suggested Citation

Grant, Darren P., What Makes a Good Economy? Evidence from Public Opinion Surveys (July 2014). Economic Inquiry, Vol. 52, Issue 3, pp. 1120-1136, 2014. Available at SSRN: https://ssrn.com/abstract=2434893 or http://dx.doi.org/10.1111/ecin.12085

Darren P. Grant (Contact Author)

Sam Houston State University - College of Business Administration - Department of Economics and International Business ( email )

SHSU Box 2118
Huntsville, TX 77341-2118
United States
936-294-4324 (Phone)

HOME PAGE: http://www.shsu.edu/dpg006

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