Inflation Expectations, Learning and Supermarket Prices

Autores
Cavallo, Alberto; Cruces, Guillermo Antonio; Pérez Truglia, Ricardo
Año de publicación
2016
Idioma
inglés
Tipo de recurso
documento de trabajo
Estado
versión enviada
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 lower-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 made readily available, individuals still place a significant weight on less accurate 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 policy-making.
Centro de Estudios Distributivos, Laborales y Sociales
Materia
Ciencias Económicas
Inflations
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:10915/128111
Acceder
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oai_identifier_str oai:sedici.unlp.edu.ar:10915/128111
network_acronym_str SEDICI
repository_id_str 1329
network_name_str SEDICI (UNLP)
spelling Inflation Expectations, Learning and Supermarket PricesCavallo, AlbertoCruces, Guillermo AntonioPérez Truglia, RicardoCiencias EconómicasInflationsPricesInformation 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 lower-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 made readily available, individuals still place a significant weight on less accurate 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 policy-making.Centro de Estudios Distributivos, Laborales y Sociales2016info:eu-repo/semantics/workingPaperinfo:eu-repo/semantics/submittedVersionDocumento de trabajohttp://purl.org/coar/resource_type/c_8042info:ar-repo/semantics/documentoDeTrabajoapplication/pdfhttp://sedici.unlp.edu.ar/handle/10915/128111enginfo:eu-repo/semantics/altIdentifier/issn/0898-2937info:eu-repo/semantics/altIdentifier/doi/10.3386/w20576info: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:UNLP2025-09-03T11:03:08Zoai:sedici.unlp.edu.ar:10915/128111Institucionalhttp://sedici.unlp.edu.ar/Universidad públicaNo correspondehttp://sedici.unlp.edu.ar/oai/snrdalira@sedici.unlp.edu.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:13292025-09-03 11:03:08.459SEDICI (UNLP) - Universidad Nacional de La Platafalse
dc.title.none.fl_str_mv Inflation Expectations, Learning and Supermarket Prices
title Inflation Expectations, Learning and Supermarket Prices
spellingShingle Inflation Expectations, Learning and Supermarket Prices
Cavallo, Alberto
Ciencias Económicas
Inflations
Prices
title_short Inflation Expectations, Learning and Supermarket Prices
title_full Inflation Expectations, Learning and Supermarket Prices
title_fullStr Inflation Expectations, Learning and Supermarket Prices
title_full_unstemmed Inflation Expectations, Learning and Supermarket Prices
title_sort Inflation Expectations, Learning and Supermarket Prices
dc.creator.none.fl_str_mv Cavallo, Alberto
Cruces, Guillermo Antonio
Pérez Truglia, Ricardo
author Cavallo, Alberto
author_facet Cavallo, Alberto
Cruces, Guillermo Antonio
Pérez Truglia, Ricardo
author_role author
author2 Cruces, Guillermo Antonio
Pérez Truglia, Ricardo
author2_role author
author
dc.subject.none.fl_str_mv Ciencias Económicas
Inflations
Prices
topic Ciencias Económicas
Inflations
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 lower-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 made readily available, individuals still place a significant weight on less accurate 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 policy-making.
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 lower-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 made readily available, individuals still place a significant weight on less accurate 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 policy-making.
publishDate 2016
dc.date.none.fl_str_mv 2016
dc.type.none.fl_str_mv info:eu-repo/semantics/workingPaper
info:eu-repo/semantics/submittedVersion
Documento de trabajo
http://purl.org/coar/resource_type/c_8042
info:ar-repo/semantics/documentoDeTrabajo
format workingPaper
status_str submittedVersion
dc.identifier.none.fl_str_mv http://sedici.unlp.edu.ar/handle/10915/128111
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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/0898-2937
info:eu-repo/semantics/altIdentifier/doi/10.3386/w20576
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
dc.source.none.fl_str_mv reponame:SEDICI (UNLP)
instname:Universidad Nacional de La Plata
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reponame_str SEDICI (UNLP)
collection SEDICI (UNLP)
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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