Coping with people's inflation perceptions during a currency changeover

Thomas A. Eife and W. Timothy Coombs

The discrepancy between popular impressions of how the 2002 changeover to the euro affected prices and its actual impact is perhaps the most surprising consequence of the single currency’s introduction. Following the changeover, perceived inflation rose significantly and returned to its prechangeover level only several months later. This paper argues that people’s inflation misperceptions could have been avoided. Using principles of crisis communication, we identify the mistakes made and present policy recommendations for future changeovers.

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Year of publication:	November 2007 ; Revised version
Authors:	Eife, Thomas A. ; Coombs, W. Timothy
Publisher:	Heidelberg : University of Heidelberg, Department of Economics
Subject:	euro changeover \| perceived inflation \| communication \| perceptual crisis \| Währungsumstellung \| Currency changeover \| Euro \| Inflationserwartung \| Inflation expectations \| Wahrnehmung \| Perception \| Politische Kommunikation \| Political communication \| Deutschland \| Germany