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Author: Lena Dräger Publisher: ISBN: Category : Languages : en Pages :
Book Description
Using a new consumer survey dataset, we document a new dimension of heterogeneity in inflation expectations that has implications for consumption and saving decisions as well as monetary policy transmission. We show that German households with the same inflation expectations differently assess whether the level of expected inflation and of nominal interest rates is appropriate or too high/too low. The 'hidden heterogeneity' in expectations stemming from these opinions is related to demographic characteristics and affects current and planned spending in addition to the Euler equation effect of the perceived real interest rate. Furthermore, these differences in opinions affect German households differently depending on whether they are renters or homeowners.
Author: Lena Dräger Publisher: ISBN: Category : Languages : en Pages :
Book Description
Using a new consumer survey dataset, we document a new dimension of heterogeneity in inflation expectations that has implications for consumption and saving decisions as well as monetary policy transmission. We show that German households with the same inflation expectations differently assess whether the level of expected inflation and of nominal interest rates is appropriate or too high/too low. The 'hidden heterogeneity' in expectations stemming from these opinions is related to demographic characteristics and affects current and planned spending in addition to the Euler equation effect of the perceived real interest rate. Furthermore, these differences in opinions affect German households differently depending on whether they are renters or homeowners.
Author: Lena Dräger Publisher: ISBN: Category : Languages : en Pages :
Book Description
Using a new consumer survey dataset, we show that macroeconomic preferences affect expectations and economic decisions through different channels. While household expectations are on average inversely related to preferences, households with the same inflation or interest rate expectations can differently assess whether the level of the corresponding variable is appropriate or too high/too low. This "hidden heterogeneity" in expectations is correlated with sociodemographic characteristics and affects durable spending and saving decisions. We also show that the variation in inflation preferences can be explained with risk preferences. Overall, this adds a new dimension to the definition of anchored expectations.
Author: Cristina Angelico Publisher: ISBN: Category : Languages : en Pages : 52
Book Description
Poor households report significantly higher inflation expectations than rich households. We assess, both theoretically and empirically, whether these differences are due to the recall of different shopping experiences and of information about aggregate inflation. Using data on shopping experiences, we show that the inflation expectations of each income group depend on the group's past grocery experiences as well as on past aggregate inflation. To explain this finding, we build a psychologically founded model in which consumers observe prices while shopping and listen to news about the general level of inflation, and - when predicting future inflation - they selectively recall the most frequent and salient memories. The model predicts that inflation expectations overweight frequent and salient memories, which leads to predictable errors in forecasting future inflation. We confirm these predictions in our data and show that our model accounts for the bulk of expectation differences across income groups.
Author: Laurent Ferrara Publisher: Springer ISBN: 3319790757 Category : Business & Economics Languages : en Pages : 300
Book Description
This book collects selected articles addressing several currently debated issues in the field of international macroeconomics. They focus on the role of the central banks in the debate on how to come to terms with the long-term decline in productivity growth, insufficient aggregate demand, high economic uncertainty and growing inequalities following the global financial crisis. Central banks are of considerable importance in this debate since understanding the sluggishness of the recovery process as well as its implications for the natural interest rate are key to assessing output gaps and the monetary policy stance. The authors argue that a more dynamic domestic and external aggregate demand helps to raise the inflation rate, easing the constraint deriving from the zero lower bound and allowing monetary policy to depart from its current ultra-accommodative position. Beyond macroeconomic factors, the book also discusses a supportive financial environment as a precondition for the rebound of global economic activity, stressing that understanding capital flows is a prerequisite for economic-policy decisions.
Author: Lena Dräger
Author: Lena Dräger
Author: Carlos Madeira
Author: Lena Dräger
Author: Jaylson Jair da Silveira
Author: Mathieu O. Pedemonte
Author: Alistair Macaulay
Author: Cristina Angelico
Author: Damjan Pfajfar
Author: Laurent Ferrara
Author: Richard Thomas Curtin