OeNB-Freitagsseminar with Tobias SchmidtDiesen Termin in meinem Kalender speichern
The pass-through from inflation perceptions to inflation expectations
OeNB-Freitagsseminar with Tobias Schmidt, Deutsche Bundesbank
This paper documents a strong relationship between households’ perceptions about inflation over the past 12 months and households’ short- and long-term expectations about future inflation. This relationship is strong during periods of high-inflation but even stronger during low-inflation periods. We establish a causal relationship by implementing a randomized information provision experiment in a large and representative survey to generate an exogenous variation in inflation perceptions. Our results show that household perceptions about past inflation drive their expectations about future inflation rates. The strength of the pass-through from perceptions to expectations varies across socioeconomic groups. We identify two critical moderating factors for this heterogeneity; differences in individual uncertainty about future inflation and information acquisition. Further, we show that the large majority of households rely on their shopping experience when forming their perceptions about past inflation and pay particular attention to food and fuel prices. The shopping experience affects inflation expectations indirectly—through perceptions.
Friday, 1 December 2023 | Start: 11:00 AM | End: 12:30 PM
The event is planned both, online via Webex and onsite at the Oesterreichische Nationalbank, Otto-Wagner-Platz 3, 1090 Vienna.
Please register by 29 November 2023, at the latest.