Does inattentiveness matter for DSGE modeling? an empirical investigation

Jenyu Chou, Joshy Easaw, Patrick Minford

Research output: Journal PublicationArticlepeer-review

1 Citation (Scopus)


The purpose of this paper is to investigate the empirical performance of the standard New Keynesian dynamic stochastic general equilibrium (DSGE) model in its usual form with full-information rational expectations and compare it with versions assuming inattentiveness—namely sticky information and imperfect information data revision. Using a Bayesian estimation approach on US quarterly data (both real-time and survey) from 1969 to 2015, we find that the model with sticky information fits best and is the only one that can generate the delayed responses observed in the data. The imperfect information data revision model is improved fits better when survey data is used in place of real-time data, suggesting that it contains extra information.
Original languageEnglish
Article number106076
JournalEconomic Modelling
Publication statusPublished - Jan 2023


  • Expectation formation
  • Inattentive expectation
  • New Keynesian
  • DSGE
  • Bayesian estimation


Dive into the research topics of 'Does inattentiveness matter for DSGE modeling? an empirical investigation'. Together they form a unique fingerprint.

Cite this