Hosted By: University of Mannheim
Organizers: Klaus Adam and Eleonora Granziera
General Description
We are pleased to announce details of the latest EABCN Training School, a course over 2 weeks entitled „Beliefs and Social Networks“. Professor Johannes Stroebel (NYU Stern School of Business) has taught the course. It wass primarily aimed at participants in the Euro Area Business Cycle Network, but applications have been also considered from doctoral students, post-doctoral researchers, and economists working in central banks and government institutions outside of the network, as well as commercial organisations.
Course outline
This course introduced participants to a recent literature that studies the interaction between household and investor beliefs, social interactions, financial markets, and the broader macroeconomy. The first lecture explored the role of investor beliefs in affecting financial markets, reviewing a number of recent research papers that combine survey evidence of investor beliefs with (largely behavioural) models of asset pricing. The second class then discussed the determinants of investor beliefs. The third class explored how social interactions affect investor beliefs and behaviors in the housing market. And the fourth class explored how social networks and social interactions affect a range of other economic outcomes, such as mutual fund investments and international trade patterns. In the process, we will introduce a new data set, the Social Connectedness Index, that measures the extent to which indiviudals across various regions are connected on Facebook. Participants were then encouraged to work on a group project with this publicly available data set to explore how social networks affect a range of economic outcomes. Possible projects include using the Social Connectedness Index to explore the propagation of economic shocks across geographies, or to forecast the spread of Covid-19.
The course was divided into four lecture sessions taught over four days, followed by a practice/
14–17 June 2021:
Session 1: Investor Beliefs and Financial Markets
Session 2: The Determinants of Household and Investor Beliefs
Session 3: Social Interactions and Beliefs in the Housing Market
Session 4: Social Networks and Economic Outcomes
25 June 2021:
Group presentations: Data work with Social Connectedness Index