Chief of Center for Economic Studies, Chief Economist
United States Census Bureau
"Business-Level Expectations and Uncertainty"
Dr. Foster will be speaking on a recent paper she co-authored entitled "Business-Level Expectations and Uncertainty". The Census Bureau’s 2015 Management and Organizational Practices Survey collected innovative 5-bin data on own future outcomes and probabilities for shipments, employment, capital and materials expenditures at 35,000 manufacturing plants. About 85% of plants provide logically sensible responses to the 5-bin questions, suggesting that most managers can form and express (subjective) probability distributions. The other 15% of plants have lower productivity, employment, wages, managerial education, structured management scores, and multinational ownership. First and second moments of plant-level subjective probability distributions covary strongly with first and second moments, respectively, of historical outcomes, suggesting that our subjective expectations data are well founded. Finally, the plant-level subjective uncertainty measures correlate positively with realized stock-return volatility, option-implied volatility and analyst disagreement about future earnings for the plant’s parent firm and for the median publicly listed firm in the plant’s industry.
Lucia Foster is the Chief Economist and Chief of the Center for Economic Studies at the US Census Bureau, having previously served as the Director of Research and Senior Economist there. She received her PhD in Economics from the University of Maryland in College Park. Her research interests include productivity, job and employment flows, innovation and technological change and management practices.
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