The author systematically examines one of the important issues of information — establishing the market price. He introduces the concept of «search» — where a buyer wanting to get a better price, is forced to question sellers. The article deals with various aspects of finding the necessary information.

Economics of Information

One in a while, every twenty years perhaps, a book appears that makes one see a whole area of human experience in a new light. Once pointed out, the new insights are sp obvious that one cannot understand how one could have missed them before. In the broad area of the political economy of western society, J.A. Schumpeter's Capitalism, Socialism and Democracy (1943) was one such book. So, with all its faults, was J.K. Galbraith's The Affluent Society (1957). Fred Hirsch's Social Limits to Growth (Routledge and Kegan Paul, London, 1977) is another.

Social limits to growth

The third way.

https://www.econstor.eu/bitstream/10419/100025/1/791620913.pdf

R&D partnerships and innovation performance : can there be too much of a good thing?

https://www.dice.hhu.de/fileadmin/redaktion/Fakultaeten/Wirtschaftswissenschaftliche_Fakultaet/DICE/Discussion_Paper/158_Stiebale.pdf

Cross-Border M&As and Innovative Activity of Acquiring and Target Firms

In an uncertain world, decisions by market participants are based on expectations. Therefore, sentiment indicators reflecting expectations have a proven track record at predicting economic variables. However, survey respondents largely perceive the world through media reports. Here, we want to make use of that. We employ a rich dataset provided by Media Tenor International, based on sentiment analysis of opinion-leading media in Germany from 2001 to 2014, transformed into several monthly indices. German industrial production is predicted in a real-time out-of-sample forecasting experiment and media indices are compared to a huge set of alternative indicators. Media data turn out to be valuable for 10- to 12-month horizon forecasts, which is in line with the lag between monetary policy announcements and their effect on industrial production. This holds in the period during and after the Great Recession when many models fail. Copyright © 2016 John Wiley & Sons, Ltd.

/pdf/do-media-data-help-to-predict-german-industrial-production-13zqlmhdoy.pdf

Do Media Data Help to Predict German Industrial Production

This article sheds light on the interaction of media, economic actors, and economic experts. Based on a unique data set of 86,000 news items rated by professional analysts of Media Tenor International and survey data, we first analyze the overall tone of the media, consumers', firms', and economic experts' opinions on the state and outlook of the economy. Second, we assess the protagonist's ability at correctly predicting GDP. Third, we use Granger causality tests to uncover who is influencing whom when it comes to the formation of opinions on the economy. We find that media reports have a significant negative bias. The economic sentiment of the media, consumers and firms does not reflect the actual situation. Finally, we find that media sentiment is not influenced by any other actor. In contrast, media appear to affect all other actors.

/pdf/asymmetric-perceptions-of-the-economy-media-firms-consumers-22mpwqzw3d.pdf

Asymmetric perceptions of the economy: Media, firms,consumers, and experts

Using a new data set that captures the share of reporting on terrorism, we explore the nexus between terrorist attacks and the news. It turns out that terrorism mainly influences news reports through the number of incidents. Regarding the reverse causality, we provide evidence that the share of the news devoted to terrorism Granger-causes further terrorist activities. However, short-run and medium-run effects differ: in the short run media coverage on terror only has an impact on the severity of terror attacks, while it affects the number of terror attacks in the long haul. These observations are consistent with the idea of competition between terrorist groups.

/pdf/can-news-draw-blood-the-impact-of-media-coverage-on-the-2otf12133p.pdf

Can News Draw Blood? The Impact of Media Coverage on the Number and Severity of Terror Attacks

Expectations form the basis of economic decisions of market participants in an uncertain world. Sentiment indicators reflect those expectations and thus have a proven track record for predicting economic variables. However, respondents of surveys perceive the world to a large extent with the help of media. So far, mainly very crude media information, such as word-count indices, has been used in the prediction of macroeconomic and financial variables. In this paper, we employ a rich data set provided by Media Tenor International, based on the sentiment analysis of all relevant media information in Germany from 2001 to 2014, whose results are transformed into several monthly indices. German industrial production is predicted in a real-time out-of-sample forecasting experiment using more than 17,000 models formed of all possible combinations with a maximum of 3 out of 48 macroeconomic, survey, and media indicators. It is demonstrated that media data are indispensable when it comes to the prediction of German industrial production both for individual models and as a part of combined forecasts. They increase reliability by improving accuracy and reducing instability of the forecasts, particularly during the recent global financial crisis.

/pdf/do-media-data-help-to-predict-german-industrial-production-36a3eg4k2t.pdf

Tobias Thomas

Papers

Do Media Data Help to Predict German Industrial Production

Asymmetric perceptions of the economy: Media, firms,consumers, and experts

Can News Draw Blood? The Impact of Media Coverage on the Number and Severity of Terror Attacks

Do Media Data Help to Predict German Industrial Production

Öffentliche Güter, natürliche Monopole und die Grenze marktlicher Versorgung