The subjective inflation expectations of households and firms : measurement, determinants, and implications

Michael Weber, Francesco D'Acunto, Yuriy Gorodnichenko, Olivier Coibion

Households' and firms' subjective inflation expectations play a central role in macroeconomic and intertemporal microeconomic models. We discuss how subjective inflation expectations are measured, the patterns they display, their determinants, and how they shape households' and firms' economic choices in the data and help us make sense of the observed heterogeneous reactions to business-cycle shocks and policy interventions. We conclude by highlighting the relevant open questions and why tackling them is important for academic research and policy making.

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Year of publication:	June 2022
Authors:	Weber, Michael ; D'Acunto, Francesco ; Gorodnichenko, Yuriy ; Coibion, Olivier
Publisher:	Bonn, Germany : IZA - Institute of Labor Economics
Subject:	macroeconomics \| intertemporal choice \| consumption \| savings \| surveys \| monetary policy \| fiscal policy \| experiments \| financial decision-making \| cognition \| communication \| Entscheidung \| Decision \| Theorie \| Theory \| Geldpolitik \| Monetary policy \| Inflationserwartung \| Inflation expectations \| Sparen \| Savings \| Finanzpolitik \| Fiscal policy \| Privater Haushalt \| Household \| Privater Konsum \| Private consumption \| Messung \| Measurement \| Intertemporale Entscheidung \| Intertemporal choice