CZECH ECONOMIC REVIEW
CZECH ECONOMIC REVIEW
The Czech Economic Review (CER) presents original, rigorously peer-reviewed research in economics with solid microeconomic grounds. Coverage includes both theoretical and methodological articles (game theory, mathematical methods in economics) as well as empirical articles (political economy, institutional economics, and public economics). CER also encourages short communications (usually limited to 2,000 words) that provide an instrument for a rapid and efficient dissemination of new results, models and methods in the above mentioned fields of economic research. One of the primary purposes is to serve as a common ground for economists and political scientists who explore political economy from a formal perspective (positive political economy, public choice and social choice, political economics). Another goal is to attract key contributions of gifted European junior economists. The journal is indexed in international bibliographical databases Scopus, EconLit, EBSCO, RePEc, CEEOL, and Google DOAJ.
The Czech Economic Review is published by Charles University in Prague. The journal was founded in 2007 as a descendant to a traditional Czech-written outlet, Acta Universitatis Carolinae Oeconomica (AUCO). Three issues are published per volume. All articles and communications are available online free of charge. Printed copies can also be ordered.

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Editorial board

Contact:
e-mail auco@fsv.cuni.cz

Charles University in Prague
Faculty of Social Sciences
Institute of Economic Studies
Opletalova 26
110 00 Prague

Distribution:
see above

CZECH ECONOMIC REVIEW, Vol 2015 No 1 (2016), 104–134

Sentiment Cyclicality

Orlando Gomez

published online: 31. 03. 2016

abstract

The paper investigates the dynamics of a model of sentiment switching. The model is built upon rumor propagation theory and it is designed to uncover, for a given population, the social process through which optimistic individuals might become pessimistic or the other way around. The outcome is a scenario of perpetual motion with the shares of optimistic and pessimistic agents varying persistently over time. On a second stage, the cyclical sentiments setup is attached to a mechanism of formation of expectations based on the notion of optimized rationality, leading to a description of the macro economy in which aggregate output and inflation exhibit sentiment driven fluctuations. The proposed model contributes to a recent strand of macroeconomic literature that recovers the Keynesian notions of animal spirits, market sentiments and waves of optimism and pessimism.

keywords: sentiments; animal spirits; business cycles; rumor propagation; New-Keynesian macroeconomics; optimized rationality

157 x 230 mm
periodicity: 3 x per year
ISSN: 1802-4696
E-ISSN: 1805-9406

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