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This chapter analyzes the empirical relationship between the pricesetting/consumption behavior and the sources of persistence in inflation and output. First, a small-scale New-Keynesian model (NKM) is examined using the method of moment and maximum likelihood estimators with US data from 1960 to 2007. Then a formal test is used to compare the fit of two competing specifications in the New-Keynesian Phillips Curve (NKPC) and the IS equation, that is, backward- and forward-looking behavior. Accordingly, the inclusion of a lagged term in the NKPC and the IS equation improves the fit of the model while offsetting the influence of inherited and extrinsic persistence; it is shown that intrinsic persistence plays a major role in approximating inflation and output dynamics for the Great Inflation period. However, the null hypothesis cannot be rejected at the 5% level for the Great Moderation period, that is, the NKM with purely forward-looking behavior and its hybrid variant are equivalent. Monte Carlo experiments investigate the validity of chosen moment conditions and the finite sample properties of the chosen estimation methods. Finally, the empirical performance of the formal test is discussed along the lines of the Akaike's and the Bayesian information criterion.

This paper surveys the treatment of expectations in estimated Dynamic Stochastic General Equilibrium (DSGE) macroeconomic models.

A recent notable development in the empirical macroeconomics literature has been the rapid growth of papers that build structural models, which include a number of frictions and shocks, and which are confronted with the data using sophisticated full-information econometric approaches, often using Bayesian methods.

A widespread assumption in these estimated models, as in most of the macroeconomic literature in general, is that economic agents' expectations are formed according to the Rational Expectations Hypothesis (REH). Various alternative ways to model the formation of expectations have, however, emerged: some are simple refinements that maintain the REH, but change the information structure along different dimensions, while others imply more significant departures from rational expectations.

I review here the modeling of the expectation formation process and discuss related econometric issues in current structural macroeconomic models. The discussion includes benchmark models assuming rational expectations, extensions based on allowing for sunspots, news, sticky information, as well as models that abandon the REH to use learning, heuristics, or subjective expectations.

Cognitive evaluation theory (CET; Deci, 1975), SDT's first mini-theory, was built from research on the dynamic interplay between external events (e.g., rewards, choice) and people's task interest or enjoyment – that is, intrinsic motivation (IM). At the time, this research was quite controversial, as operant theory (Skinner, 1971) had dominated the psychological landscape. The central assumption of operant theory was that reinforcement contingencies in the environment control behavior, which precluded the existence of inherently satisfying activities performed for non-separable outcomes. During this time, Deci proposed that people – by nature – possess intrinsic motivation (IM), which can manifest as engagement in curiosity-based behaviors, discovery of new perspectives, and seeking out optimal challenges (see also Harlow, 1953; White, 1959). IM thus represents a manifestation of the organismic growth tendency and is readily observed in infants' and toddlers' exploratory behavior and play. Operationally, an intrinsically motivated activity is performed for its own sake – that is, the behavior is experienced as inherently satisfying. From an attributional perspective (deCharms, 1968), such behaviors have an internal perceived locus of causality, as people perceive their behavior as emanating from their sense of self, rather than from experiences of control or coercion.

Small-scale VARs are widely used in macroeconomics for forecasting US output, prices, and interest rates. However, recent work suggests these models may exhibit instabilities. As such, a variety of estimation or forecasting methods might be used to improve their forecast accuracy. These include using different observation windows for estimation, intercept correction, time-varying parameters, break dating, Bayesian shrinkage, model averaging, etc. This paper compares the effectiveness of such methods in real-time forecasting. We use forecasts from univariate time series models, the Survey of Professional Forecasters, and the Federal Reserve Board's Greenbook as benchmarks.

Over the last decades, the accounting and control literature has featured much studying of and debate about the role and designing of incentives. Over the last year or so, the debate over incentives and bonuses has become a much more public one, as illustrated by the current public furor over bankers' bonuses and frequent calls to limit them and/or tax them more heavily. The public nature of the debate is new, but the emotional intensity is not; an intense emotionality has often characterized discussions of these subjects in print, as recently illustrated by a controversy between supporters and opponents of goal setting published in Academy of Management Perspectives.

This chapter tries to structure the debate by defining – and clarifying the interactions between – key components of the debate. I then review some – by no means all – of the evidence available in three streams of research: goal setting, self-determination theory, and economics. A surprisingly large number of commonalities emerge from this review. I then revisit in light of this review two accountability models I had introduced at a previous conference as well a forthcoming field study of the sophisticated approach developed by a successful multinational corporation.

Engagement, motivation, and persistence are usually associated with positive outcomes. However, too much of it can overtax our psychophysiological system and put it at risk. On the basis of a neuro-dynamic personality and self-regulation model, we explain the neurobehavioral mechanisms presumably underlying engagement and how engagement, when overtaxing the individual, becomes automatically inhibited for reasons of protection. We explain how different intensities and patterns of engagement may relate to personality traits such as Self-directedness, Conscientiousness, Drive for Reward, and Absorption, which we conceive of as functions or strategies of adaptive neurobehavioral systems. We describe how protective inhibitions and personality traits contribute to phenomena such as disengagement and increased effort-sense in chronic fatigue conditions, which often affect professions involving high socio-emotional interactions. By doing so we adduce evidence on hemispheric asymmetry of motivation, neuromodulation by dopamine, self-determination, task engagement, and physiological disengagement. Not least, we discuss educational implications of our model.

Educational psychologists have, over the last half century or so, directed their attention to the study of student motivation. While teachers have not entirely been ignored, there has been little inquiry into teacher motivation that has been systematic and theory-driven. The concentration on students has tended to overlook the centrality of teacher motivations as integral to teachers’ goals, beliefs, perceptions, aspirations, and behaviours, and thereby to student motivations and learning. It is perhaps not surprising that those motivation researchers who have developed robust theories in relation to student learning in educational contexts would begin to turn their attention to teachers, to see whether those same theories might have explanatory power with regard to teacher motivations. Teacher self-efficacy research (e.g., Tschannen-Moran & Woolfolk Hoy, 2007; Woolfolk Hoy & Burke-Spero, 2005) has made important contributions to the study of teachers. Motivation researchers are now beginning to turn their attention to other aspects of the complex of motivational factors which demand greater attention and exploration. Robust theoretical frameworks already exist in the motivation literature, which can be applied to guide future research in this area. There has recently been a surge of interest, or what we have elsewhere described as a “Zeitgeist” (Watt & Richardson, 2008a) in applying well-developed theories in motivation research, to the domain of teaching.

The study investigated the relevance of psychosocial variables and how they interact with socio economic status (SES) as it relates to the persistence of African-American students at the major US public universities. The study analyzed the responses of 327 web survey participants attending a major public university in the eastern region of the United States. The results suggest that students from higher SES backgrounds, more than likely, have already acquired or are more easily able to adopt characteristics that are ideal for persistence (e.g., commitment to personal goals, and biculturalism) than students from lower SES backgrounds.

Previous studies have shown that – even after controlling for precollege performance – students who come from families with higher-income levels and parental education persist to graduate at higher rates and earn higher-grade point averages (Bowen & Bok, 1998; Pascarella, 1985). This study purports to provide the context for reflecting on the ways in which current student persistence theories might be modified to account more directly for how SES may influence psychosocial variables that contribute to the process of African-American student persistence in major US universities.