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Discussion Paper Details

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Title: Seemingly Irrelevant Events Affect Perceptions and Expectations - The FIFA World Cup 2006 as a Natural Experiment

Author(s): Thomas J Dohmen, Armin Falk, David Huffman and Uwe Sunde

Publication Date: September 2006

Keyword(s): expectation formation, macroeconomic outcomes, psychology, soccer World Cup and sunspots

Programme Area(s): International Macroeconomics

Abstract: Prominent economic theories have emphasized the role of commonly held perceptions and expectations for determining macroeconomic outcomes. A key empirical question is how such collectively held beliefs are formed. We use the FIFA World Cup 2006 as a natural experiment. We provide direct evidence that seemingly irrelevant events (the outcomes of soccer matches) can systematically affect individual perceptions about economic prospects, both on a personal and economy-wide level.

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Bibliographic Reference

Dohmen, T, Falk, A, Huffman, D and Sunde, U. 2006. 'Seemingly Irrelevant Events Affect Perceptions and Expectations - The FIFA World Cup 2006 as a Natural Experiment'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=5851