Do Behavioral Biases Adversely Affect the Macro-Economy?

George M. Korniotis

Board of Governors of the Federal Reserve System

Alok Kumar

University of Texas at Austin, McCombs School of Business

Data for Figure 1
	Unconditional RS
AL	0.3306
AK	0.3201
AZ	0.1645
AR	0.0993
CA	0.3852
CO	0.4008
CT	0.3429
DE	0.5227
DC	0.3042
FL	0.1186
GA	0.2755
HI	0.3746
ID	0.2376
IL	0.2590
IN	0.2213
IA	0.1141
KS	0.2529
KY	0.0641
LA	0.3326
ME	0.0275
MD	0.2656
MA	0.1842
MI	0.3011
MN	0.2981
MS	0.2952
MO	0.3061
MT	0.3554
NE	0.1163
NV	0.2326
NH	0.4476
NJ	0.3707
NM	0.4549
NY	0.4528
NC	0.2844
ND	0.0992
OH	0.3651
OK	0.3324
OR	0.5051
PA	0.4042
RI	-0.0737
SC	0.2370
SD	0.0067
TN	0.2857
TX	0.3097
UT	0.2519
VT	0.1386
VA	0.3784
WA	0.4480
WV	0.0101
WI	-0.0577
WY	0.2184

Return to Figure 1

Data for Figure 2
OR Relative GSP Growth	OR Relative SI Growth	OR Relative MVP Return	KY Relative GSP Growth	KY Relative SI Growth	KY Relative MVP Return	CT Relative GSP Growth	CT Relative SI Growth	CT Relative MVP Return	AR Relative GSP Growth	AR Relative SI Growth	AR Relative MVP Return
1965: -0.004	-0.003	-0.005	0.013	0.012	0.012	-0.014	-0.010	-0.007	0.003	-0.007	0.007
1966: -0.021	-0.011	0.004	0.001	0.013	-0.005	0.009	0.007	0.009	0.012	0.032	-0.003
1967: -0.008	-0.001	0.002	0.004	0.014	0.001	0.012	0.020	0.001	0.013	-0.002	0.004
1968: 0.002	-0.015	0.003	-0.012	-0.000	-0.004	-0.023	-0.029	-0.009	0.012	-0.007	-0.014
1969: -0.032	-0.009	-0.010	-0.005	0.015	-0.006	-0.002	0.007	0.005	-0.008	0.003	0.004
1970: -0.006	0.002	0.005	0.015	0.003	0.006	-0.010	-0.006	-0.004	0.003	0.019	0.010
1971: 0.011	0.007	0.006	0.001	0.002	-0.003	-0.026	-0.020	-0.008	0.018	0.021	0.006
1972: 0.032	0.014	-0.003	0.009	0.009	0.006	-0.003	-0.001	0.004	0.039	0.018	-0.004
1973: 0.015	0.000	-0.003	-0.001	0.001	-0.004	-0.006	-0.004	-0.001	0.037	0.044	-0.013
1974: 0.007	0.016	0.013	0.028	0.018	0.006	-0.006	-0.009	0.013	0.006	0.005	-0.007
1975: -0.030	0.006	-0.018	-0.015	-0.001	-0.009	-0.028	-0.020	-0.015	-0.035	-0.014	0.021
1976: 0.022	0.023	0.009	-0.004	0.008	0.008	0.001	-0.005	0.004	0.016	0.010	-0.008
1977: 0.009	-0.003	0.005	0.002	0.016	0.000	0.012	0.007	0.014	0.005	0.002	0.006
1978: -0.002	0.005	-0.008	-0.012	-0.001	-0.013	0.007	-0.001	-0.007	0.032	0.031	-0.015
1979: -0.007	0.003	0.007	-0.010	0.012	0.011	0.001	0.015	0.002	-0.026	-0.026	-0.003
1980: -0.045	-0.018	-0.010	-0.037	-0.031	-0.014	0.015	0.029	0.001	-0.036	-0.032	0.015
1981: -0.083	-0.036	-0.009	-0.006	-0.002	0.014	-0.014	0.007	-0.006	0.009	0.018	-0.002
1982: -0.033	-0.041	0.011	-0.009	0.001	-0.001	0.046	0.021	0.010	-0.009	-0.010	0.004
1983: 0.015	0.009	0.017	-0.035	-0.027	-0.006	0.018	0.006	0.005	-0.004	0.004	0.007
1984: 0.006	-0.013	-0.012	0.020	0.015	0.018	0.017	0.009	-0.012	0.030	0.017	-0.022
1985: -0.012	-0.012	-0.004	-0.027	-0.017	-0.025	0.013	0.003	0.001	-0.033	0.005	0.016
1986: 0.007	0.003	0.010	0.001	-0.007	0.020	0.035	0.018	0.008	-0.004	-0.009	-0.011
1987: 0.016	-0.003	-0.004	0.011	0.008	-0.008	0.038	0.037	-0.001	0.002	-0.016	0.005
1988: -0.002	0.018	-0.006	0.008	-0.008	0.003	0.016	0.010	-0.005	0.007	-0.005	-0.001
1989: -0.003	-0.014	-0.000	0.005	0.005	0.000	-0.009	0.022	-0.008	-0.004	-0.002	-0.002
1990: -0.013	0.021	0.003	-0.001	0.004	-0.009	-0.016	-0.026	0.003	0.004	-0.013	0.002
1991: 0.038	-0.002	0.005	0.017	0.029	-0.002	0.043	-0.023	0.006	0.025	0.026	0.003
1992: -0.004	0.002	-0.014	0.029	0.011	0.016	-0.002	0.007	-0.004	0.024	0.030	-0.009
1993: 0.023	0.005	0.009	-0.000	-0.001	-0.011	-0.018	0.002	-0.003	-0.002	0.002	0.001
1994: 0.006	0.001	-0.004	0.013	0.002	0.001	-0.006	-0.009	0.004	0.011	0.005	0.005
1995: 0.020	0.026	-0.000	0.004	-0.004	-0.004	0.048	0.002	0.006	0.011	-0.005	-0.004
1996: 0.066	0.006	0.019	-0.003	0.003	0.002	0.001	0.000	-0.006	-0.000	0.015	-0.005
1997: 0.001	-0.022	-0.023	0.013	0.001	0.009	0.029	0.008	0.006	-0.020	-0.019	0.007
1998: -0.018	-0.022	-0.005	0.028	-0.002	0.006	0.011	0.011	-0.008	-0.006	-0.012	0.005
1999: -0.025	-0.015	0.007	-0.015	-0.008	-0.015	-0.016	-0.003	-0.001	0.004	0.008	-0.022
2000:		0.008			-0.026			0.008			0.014
2001:		-0.018			0.025			-0.002			0.002
2002:		0.009			0.006			-0.015			-0.001
2003:		-0.003			-0.003			0.004			0.003
		0.001			-0.007			0.008

Return to Figure 2

Data for Figure 3
	Sophistication Index	Unconditional RS	Conditional RS
AL	-0.3330	0.0119	-0.0033
AK	-0.1670	0.1501	0.1519
AZ	0.0000	0.3120	0.2953
AR	0.1670	0.3397	0.3281
CA	0.3330	0.3020	0.3182

Return to Figure 3

Data for Figure 4
	Relative GSP Growth Mean	Relative GSP Growth Standard Deviation
AL	0.0039	0.0116
AK	0.0004	0.1247
AZ	0.0015	0.0233
AR	0.0042	0.0185
CA	-0.0014	0.0145
CO	0.0045	0.0205
CT	0.0047	0.0202
DE	0.0092	0.0344
DC	0.0168	0.0288
FL	0.0028	0.0190
GA	0.0089	0.0169
HI	0.0006	0.0379
ID	-0.0039	0.0316
IL	-0.0016	0.0116
IN	-0.0034	0.0223
IA	-0.0008	0.0321
KS	0.0000	0.0182
KY	0.0004	0.0158
LA	-0.0020	0.0542
ME	0.0023	0.0194
MD	0.0031	0.0138
MA	0.0059	0.0181
MI	-0.0052	0.0371
MN	0.0039	0.0197
MS	0.0036	0.0220
MO	-0.0006	0.0172
MT	-0.0075	0.0340
NE	0.0026	0.0292
NV	-0.0050	0.0194
NH	0.0060	0.0238
NJ	0.0030	0.0167
NM	-0.0022	0.0432
NY	0.0009	0.0180
NC	0.0050	0.0174
ND	0.0011	0.0785
OH	-0.0022	0.0158
OK	-0.0027	0.0402
OR	-0.0014	0.0257
PA	-0.0002	0.0115
RI	0.0002	0.0160
SC	0.0073	0.0169
SD	0.0047	0.0470
TN	0.0057	0.0158
TX	0.0018	0.0339
UT	-0.0020	0.0227
VT	0.0006	0.0196
VA	0.0080	0.0145
WA	0.0012	0.0248
WV	-0.0042	0.0226
WI	0.0001	0.0121
WY	-0.0075	0.0665

Return to Figure 4

Data for Figures 5
	Relative GSP Growth Mean	Relative GSP Growth Standard Deviation	Relative SI Growth Mean	Relative SI Growth Standard Deviation	Relative MVP Return Mean	Relative MVP Return Standard Deviation
AL	0.0039	0.0116	0.0039	0.0101	-0.0005	0.0054
AK	0.0004	0.1247	-0.0010	0.0841	0.0005	0.0667
AZ	0.0015	0.0233	-0.0013	0.0195	0.0001	0.0070
AR	0.0042	0.0185	0.0042	0.0174	-0.0002	0.0097
CA	-0.0014	0.0145	-0.0040	0.0096	0.0001	0.0064
CO	0.0045	0.0205	0.0028	0.0137	0.0001	0.0059
CT	0.0047	0.0202	0.0019	0.0151	0.0000	0.0073
DE	0.0092	0.0344	-0.0033	0.0148	0.0000	0.0140
DC	0.0168	0.0288	0.0019	0.0232	-0.0003	0.0125
FL	0.0028	0.0190	0.0025	0.0166	-0.0001	0.0064
GA	0.0089	0.0169	0.0063	0.0104	-0.0003	0.0065
HI	0.0006	0.0379	-0.0030	0.0261	0.0001	0.0143
ID	-0.0039	0.0316	-0.0017	0.0245	0.0000	0.0119
IL	-0.0016	0.0116	-0.0019	0.0085	-0.0001	0.0046
IN	-0.0034	0.0223	-0.0021	0.0145	-0.0002	0.0134
IA	-0.0008	0.0321	-0.0020	0.0276	0.0006	0.0176
KS	0.0000	0.0182	-0.0001	0.0142	0.0000	0.0092
KY	0.0004	0.0158	0.0020	0.0125	-0.0001	0.0112
LA	-0.0020	0.0542	0.0008	0.0239	0.0002	0.0319
ME	0.0023	0.0194	0.0018	0.0189	-0.0003	0.0078
MD	0.0031	0.0138	0.0016	0.0114	-0.0001	0.0059
MA	0.0059	0.0181	0.0027	0.0136	0.0001	0.0064
MI	-0.0052	0.0371	-0.0022	0.0234	-0.0007	0.0222
MN	0.0039	0.0197	0.0041	0.0144	0.0002	0.0081
MS	0.0036	0.0220	0.0046	0.0158	-0.0001	0.0126
MO	-0.0006	0.0172	-0.0010	0.0117	-0.0002	0.0089
MT	-0.0075	0.0340	-0.0054	0.0256	0.0005	0.0126
NE	0.0026	0.0292	0.0008	0.0255	0.0000	0.0147
NV	-0.0050	0.0194	-0.0047	0.0184	0.0001	0.0062
NH	0.0060	0.0238	0.0046	0.0178	0.0000	0.0068
NJ	0.0030	0.0167	0.0012	0.0106	-0.0001	0.0061
NM	-0.0022	0.0432	-0.0022	0.0181	0.0002	0.0155
NY	0.0009	0.0180	-0.0015	0.0119	0.0000	0.0069
NC	0.0050	0.0174	0.0058	0.0115	-0.0001	0.0083
ND	0.0011	0.0785	-0.0009	0.0748	0.0013	0.0454
OH	-0.0022	0.0158	-0.0018	0.0101	-0.0003	0.0100
OK	-0.0027	0.0402	-0.0006	0.0234	0.0002	0.0164
OR	-0.0014	0.0257	-0.0020	0.0151	-0.0001	0.0096
PA	-0.0002	0.0115	-0.0002	0.0068	-0.0002	0.0054
RI	0.0002	0.0160	-0.0007	0.0165	-0.0001	0.0076
SC	0.0073	0.0169	0.0052	0.0125	-0.0004	0.0083
SD	0.0047	0.0470	0.0031	0.0444	0.0005	0.0211
TN	0.0057	0.0158	0.0049	0.0113	-0.0003	0.0065
TX	0.0018	0.0339	0.0036	0.0189	0.0001	0.0107
UT	-0.0020	0.0227	-0.0028	0.0157	0.0002	0.0077
VT	0.0006	0.0196	0.0026	0.0147	0.0000	0.0066
VA	0.0080	0.0145	0.0059	0.0108	-0.0002	0.0064
WA	0.0012	0.0248	0.0007	0.0175	-0.0001	0.0080
WV	-0.0042	0.0226	-0.0012	0.0185	-0.0003	0.0144
WI	0.0001	0.0121	0.0007	0.0154	-0.0001	0.0058
WY	-0.0075	0.0665	0.0000	0.0318	0.0005	0.0169

Return to Figure 5

Data for Figure 6
	Relative GSP Growth Mean	Relative GSP Growth Standard Deviation	Relative SI Growth Mean	Relative SI Growth Standard Deviation	Relative MVP Return Mean	Relative MVP Return Standard Deviation
AL	0.0039	0.0116	0.0039	0.0101	-0.0005	0.0054
AK	0.0004	0.1247	-0.0010	0.0841	0.0005	0.0667
AZ	0.0015	0.0233	-0.0013	0.0195	0.0001	0.0070
AR	0.0042	0.0185	0.0042	0.0174	-0.0002	0.0097
CA	-0.0014	0.0145	-0.0040	0.0096	0.0001	0.0064
CO	0.0045	0.0205	0.0028	0.0137	0.0001	0.0059
CT	0.0047	0.0202	0.0019	0.0151	0.0000	0.0073
DE	0.0092	0.0344	-0.0033	0.0148	0.0000	0.0140
DC	0.0168	0.0288	0.0019	0.0232	-0.0003	0.0125
FL	0.0028	0.0190	0.0025	0.0166	-0.0001	0.0064
GA	0.0089	0.0169	0.0063	0.0104	-0.0003	0.0065
HI	0.0006	0.0379	-0.0030	0.0261	0.0001	0.0143
ID	-0.0039	0.0316	-0.0017	0.0245	0.0000	0.0119
IL	-0.0016	0.0116	-0.0019	0.0085	-0.0001	0.0046
IN	-0.0034	0.0223	-0.0021	0.0145	-0.0002	0.0134
IA	-0.0008	0.0321	-0.0020	0.0276	0.0006	0.0176
KS	0.0000	0.0182	-0.0001	0.0142	0.0000	0.0092
KY	0.0004	0.0158	0.0020	0.0125	-0.0001	0.0112
LA	-0.0020	0.0542	0.0008	0.0239	0.0002	0.0319
ME	0.0023	0.0194	0.0018	0.0189	-0.0003	0.0078
MD	0.0031	0.0138	0.0016	0.0114	-0.0001	0.0059
MA	0.0059	0.0181	0.0027	0.0136	0.0001	0.0064
MI	-0.0052	0.0371	-0.0022	0.0234	-0.0007	0.0222
MN	0.0039	0.0197	0.0041	0.0144	0.0002	0.0081
MS	0.0036	0.0220	0.0046	0.0158	-0.0001	0.0126
MO	-0.0006	0.0172	-0.0010	0.0117	-0.0002	0.0089
MT	-0.0075	0.0340	-0.0054	0.0256	0.0005	0.0126
NE	0.0026	0.0292	0.0008	0.0255	0.0000	0.0147
NV	-0.0050	0.0194	-0.0047	0.0184	0.0001	0.0062
NH	0.0060	0.0238	0.0046	0.0178	0.0000	0.0068
NJ	0.0030	0.0167	0.0012	0.0106	-0.0001	0.0061
NM	-0.0022	0.0432	-0.0022	0.0181	0.0002	0.0155
NY	0.0009	0.0180	-0.0015	0.0119	0.0000	0.0069
NC	0.0050	0.0174	0.0058	0.0115	-0.0001	0.0083
ND	0.0011	0.0785	-0.0009	0.0748	0.0013	0.0454
OH	-0.0022	0.0158	-0.0018	0.0101	-0.0003	0.0100
OK	-0.0027	0.0402	-0.0006	0.0234	0.0002	0.0164
OR	-0.0014	0.0257	-0.0020	0.0151	-0.0001	0.0096
PA	-0.0002	0.0115	-0.0002	0.0068	-0.0002	0.0054
RI	0.0002	0.0160	-0.0007	0.0165	-0.0001	0.0076
SC	0.0073	0.0169	0.0052	0.0125	-0.0004	0.0083
SD	0.0047	0.0470	0.0031	0.0444	0.0005	0.0211
TN	0.0057	0.0158	0.0049	0.0113	-0.0003	0.0065
TX	0.0018	0.0339	0.0036	0.0189	0.0001	0.0107
UT	-0.0020	0.0227	-0.0028	0.0157	0.0002	0.0077
VT	0.0006	0.0196	0.0026	0.0147	0.0000	0.0066
VA	0.0080	0.0145	0.0059	0.0108	-0.0002	0.0064
WA	0.0012	0.0248	0.0007	0.0175	-0.0001	0.0080
WV	-0.0042	0.0226	-0.0012	0.0185	-0.0003	0.0144
WI	0.0001	0.0121	0.0007	0.0154	-0.0001	0.0058
WY	-0.0075	0.0665	0.0000	0.0318	0.0005	0.0169

Return to Figure 6

^♣ This version is optimized for use by screen readers. Descriptions for all mathematical expressions are provided in LaTex format. A printable pdf version is available. Return to Text