Sentiment and economic activity in Brazil

Purpose The purpose of this study is to analyze how sentiment affects economic activity in Brazil. Design/methodology/approach Based on a nonlinear autoregressive distributed lag (NARDL) model, examines detail the short-term and long-term asymmetric impacts between variables during period from January 2007 December 2020. Findings There are three main results study. First, an important factor for Brazil, its effect possibly occurs through channels consumption investment, which two components growth. Second, different ways short long term: although short-term, immediate shocks may be confusing, negative previous periods have impact activity. Third, optimism pessimism asymmetric, run, only significant positive impact. Originality/value relationship still controversial issue literature seeks advance understanding