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These readings provide the common language of the course. Read the survey for the field’s map, Woodford for the expectations channel, and Kuttner for the logic of isolating news.
Central-bank communication: a field map
A broad synthesis of the theory and evidence on why central banks communicate, how transparency works, and how messages affect markets and the public.
Blinder, Ehrmann, Fratzscher, de Haan & Jansen · 2008 · JEL
Communication and policy effectiveness
Why expectations about future policy can matter at least as much as the current policy action—and why a coherent reaction function matters.
Woodford · 2005 · Jackson Hole
Monetary-policy surprises
The foundational futures-based approach to separating the expected component of a policy decision from the surprise observed at the meeting.
Kuttner · 2001 · Journal of Monetary Economics
Lecture 1 · Communication and expectations
Central-bank communication and monetary policy
Use this survey to distinguish transparency, signalling, commitment, coordination, and democratic accountability.
Blinder et al. · 2008
Information rigidity and expectations formation
Connect sluggish belief updating to the empirical behaviour of forecast errors and disagreement.
Coibion & Gorodnichenko · 2015
Central-bank communication with the general public
Moves the audience beyond professional forecasters and asks how understandable communication affects public engagement.
Haldane & McMahon · 2018
Lecture 2 · Measuring expectations
Monetary-policy surprises and interest rates
Read the timing and calendar-weight logic carefully: the observed futures rate is a monthly average, not a meeting-specific expectation.
Kuttner · 2001
Expectations, surveys, and forecast disagreement
Use survey evidence to ask whose expectation is observed and whether disagreement is noise, information, or heterogeneity.
Mankiw, Reis & Wolfers · 2004
Market prices under risk
Keep physical expectations distinct from risk-neutral prices; the gap may contain risk premia, liquidity, and convexity.
Course synthesis · Lecture 2
Lecture 3 · Surprises and spillovers
Do actions speak louder than words?
Shows why a single surprise is insufficient: announcements contain both a current target component and news about the future policy path.
Gürkaynak, Sack & Swanson · 2005
Deconstructing monetary-policy surprises
Separates policy shocks from central-bank information shocks and shows why market co-movement can reverse the interpretation.
Jarociński & Karadi · 2020
Global asset prices and FOMC announcements
Provides a template for tracing US policy news into international asset prices while confronting timing and market-closure problems.
Hausman & Wongswan · 2011
Lecture 4 · Communication as data
Shocking language
Turns central-bank language into measured news and connects textual innovations to macroeconomic outcomes.
Hansen & McMahon · 2016
Text as data
A disciplined overview of representation, prediction, interpretation, and validation in quantitative text analysis.
Gentzkow, Kelly & Taddy · 2019
Domain-specific dictionaries
A reminder that ordinary sentiment dictionaries can misclassify specialised financial language; validation must match the domain.
Loughran & McDonald · 2011
How to read each paper
1 · Define the object
- What is the economic concept the authors want to measure?
- Who holds the belief, over what horizon, and under which information set?
- Is the treatment a decision, a surprise, a document, exposure, or interpretation?
2 · Recover the design
- What provides the identifying variation?
- What must be excluded from the event window or comparison?
- Which assumption turns the estimated coefficient into the stated estimand?
3 · Audit the claim
- Is the outcome immediate, persistent, domestic, global, observed, or inferred?
- Which measurement wedges remain?
- What alternative interpretation would generate the same empirical pattern?