Inflation expectations, learning, and supermarket prices: Evidence from survey experiments

Autores
Cavallo, Alberto; Cruces, Guillermo; Perez Truglia, Ricardo
Año de publicación
2017
Idioma
inglés
Tipo de recurso
artículo
Estado
versión publicada
Descripción
Information frictions play a central role in the formation of household inflation expectations, but there is no consensus about their origins. We address this question with novel evidence from survey experiments. We document two main findings. First, individuals in low inflation contexts have significantly weaker priors about the inflation rate. This finding suggests that rational inattention may be an important source of information frictions. Second, cognitive limitations also appear to be a source of information frictions: Even when information about inflation statistics is available, individuals still place a significant weight on inaccurate sources of information, such as their memories of the price changes of the supermarket products they purchase. We discuss the implications of these findings for macroeconomic models and policymaking.
Facultad de Ciencias Económicas
Centro de Estudios Distributivos, Laborales y Sociales
Materia
Ciencias Económicas
Inflation
Prices
Nivel de accesibilidad
acceso abierto
Condiciones de uso
http://creativecommons.org/licenses/by-nc-sa/4.0/
Repositorio
SEDICI (UNLP)
Institución
Universidad Nacional de La Plata
OAI Identificador
oai:sedici.unlp.edu.ar:10915/87188
Acceder
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network_name_str SEDICI (UNLP)
spelling Inflation expectations, learning, and supermarket prices: Evidence from survey experimentsCavallo, AlbertoCruces, GuillermoPerez Truglia, RicardoCiencias EconómicasInflationPricesInformation frictions play a central role in the formation of household inflation expectations, but there is no consensus about their origins. We address this question with novel evidence from survey experiments. We document two main findings. First, individuals in low inflation contexts have significantly weaker priors about the inflation rate. This finding suggests that rational inattention may be an important source of information frictions. Second, cognitive limitations also appear to be a source of information frictions: Even when information about inflation statistics is available, individuals still place a significant weight on inaccurate sources of information, such as their memories of the price changes of the supermarket products they purchase. We discuss the implications of these findings for macroeconomic models and policymaking.Facultad de Ciencias EconómicasCentro de Estudios Distributivos, Laborales y Sociales2017info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionArticulohttp://purl.org/coar/resource_type/c_6501info:ar-repo/semantics/articuloapplication/pdf1-35http://sedici.unlp.edu.ar/handle/10915/87188enginfo:eu-repo/semantics/altIdentifier/issn/1945-7707info:eu-repo/semantics/altIdentifier/doi/10.1257/mac.20150147info:eu-repo/semantics/openAccesshttp://creativecommons.org/licenses/by-nc-sa/4.0/Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0)reponame:SEDICI (UNLP)instname:Universidad Nacional de La Platainstacron:UNLP2025-09-03T10:49:35Zoai:sedici.unlp.edu.ar:10915/87188Institucionalhttp://sedici.unlp.edu.ar/Universidad públicaNo correspondehttp://sedici.unlp.edu.ar/oai/snrdalira@sedici.unlp.edu.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:13292025-09-03 10:49:36.232SEDICI (UNLP) - Universidad Nacional de La Platafalse
dc.title.none.fl_str_mv Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
title Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
spellingShingle Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
Cavallo, Alberto
Ciencias Económicas
Inflation
Prices
title_short Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
title_full Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
title_fullStr Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
title_full_unstemmed Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
title_sort Inflation expectations, learning, and supermarket prices: Evidence from survey experiments
dc.creator.none.fl_str_mv Cavallo, Alberto
Cruces, Guillermo
Perez Truglia, Ricardo
author Cavallo, Alberto
author_facet Cavallo, Alberto
Cruces, Guillermo
Perez Truglia, Ricardo
author_role author
author2 Cruces, Guillermo
Perez Truglia, Ricardo
author2_role author
author
dc.subject.none.fl_str_mv Ciencias Económicas
Inflation
Prices
topic Ciencias Económicas
Inflation
Prices
dc.description.none.fl_txt_mv Information frictions play a central role in the formation of household inflation expectations, but there is no consensus about their origins. We address this question with novel evidence from survey experiments. We document two main findings. First, individuals in low inflation contexts have significantly weaker priors about the inflation rate. This finding suggests that rational inattention may be an important source of information frictions. Second, cognitive limitations also appear to be a source of information frictions: Even when information about inflation statistics is available, individuals still place a significant weight on inaccurate sources of information, such as their memories of the price changes of the supermarket products they purchase. We discuss the implications of these findings for macroeconomic models and policymaking.
Facultad de Ciencias Económicas
Centro de Estudios Distributivos, Laborales y Sociales
description Information frictions play a central role in the formation of household inflation expectations, but there is no consensus about their origins. We address this question with novel evidence from survey experiments. We document two main findings. First, individuals in low inflation contexts have significantly weaker priors about the inflation rate. This finding suggests that rational inattention may be an important source of information frictions. Second, cognitive limitations also appear to be a source of information frictions: Even when information about inflation statistics is available, individuals still place a significant weight on inaccurate sources of information, such as their memories of the price changes of the supermarket products they purchase. We discuss the implications of these findings for macroeconomic models and policymaking.
publishDate 2017
dc.date.none.fl_str_mv 2017
dc.type.none.fl_str_mv info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Articulo
http://purl.org/coar/resource_type/c_6501
info:ar-repo/semantics/articulo
format article
status_str publishedVersion
dc.identifier.none.fl_str_mv http://sedici.unlp.edu.ar/handle/10915/87188
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dc.language.none.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv info:eu-repo/semantics/altIdentifier/issn/1945-7707
info:eu-repo/semantics/altIdentifier/doi/10.1257/mac.20150147
dc.rights.none.fl_str_mv info:eu-repo/semantics/openAccess
http://creativecommons.org/licenses/by-nc-sa/4.0/
Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0)
eu_rights_str_mv openAccess
rights_invalid_str_mv http://creativecommons.org/licenses/by-nc-sa/4.0/
Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0)
dc.format.none.fl_str_mv application/pdf
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reponame_str SEDICI (UNLP)
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instname_str Universidad Nacional de La Plata
instacron_str UNLP
institution UNLP
repository.name.fl_str_mv SEDICI (UNLP) - Universidad Nacional de La Plata
repository.mail.fl_str_mv alira@sedici.unlp.edu.ar
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