Centre for Development Economics
and
Department of Economics, Delhi School of Economics
ANNOUNCE A SEMINAR
Modeling Social Learning as Epidemics using Twitter Data.
by
Shivi Kalra
State University of New York at Binghamton
On
26th February 2019 (Tuesday) at 3:00 PM
Venue : Seminar Room (First Floor)
Department of Economics, Delhi School of Economics
All are cordially invited
Abstract
An important debate in macroeconomics is how people form expectations. Rational expectations and adaptive learning approaches assume that all agents in the economy are as good as econometricians. In reality, most people learn by talking to their neighbors, relatives, and friends. However, obtaining data on expectations is extremely difficult. Most of the surveys of expectations are limited to a few economic variables like inflation, unemployment, etc. This paper proposes a new way of modeling social learning by using an epidemiological model. Twitter data captures the spread of information when people learn from each other. Disease and expectations both spread infectiously among people before dying out. Predicting the trend of the spread of expectations is essential for policy formation. Least squares estimation is used to estimate the speed of transmission of both economic and noneconomic news items among people. I compare the estimates obtained by fitting Twitter data on the epidemiological model to the rate of spread of different epidemics. How quickly and effectively does news spread is another question of interest. Fast transmission of news implies that people adjust their expectations quickly vs. slow transmission that implies sticky information. The results suggest that economic news spreads relatively slowly, and there is heterogeneity in person to person learning. Information transmission on twitter spreads like the flu which changes its course over a period of time. However, unlike epidemics, each person has a different probability of spreading news due to the presence of influencers on Twitter.