Research / BFI Working PaperMay 16, 2022

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.

More Research From These Scholars

BFI Working Paper Nov 17, 2019

Estimating the Anomaly Base Rate

Alex Chinco, Andreas Neuhierl, Michael Weber
Topics:  Uncategorized
BFI Working Paper Mar 25, 2021

The Effect of Macroeconomic Uncertainty on Household Spending

Olivier Coibion, Dimitris Georgarakos, Yuriy Gorodnichenko, Geoff Kenny, Michael Weber
Topics:  Uncategorized
BFI Working Paper Aug 1, 2016

The Effect of Unconventional Fiscal Policy on Consumption Expenditure

Michael Weber, Daniel Hoang, Francesco D'Acunto
Topics:  Fiscal Studies