Inflation Narratives

Publikation: Working paperForskning

Dokumenter

  • Peter Andre
  • Ingar Haaland
  • Christopher Roth
  • Johannes Wohlfart
We provide evidence on the stories that people tell to explain a historically notable rise in inflation using samples of experts, U.S. households, and managers. We document substantial heterogeneity in narratives about the drivers of higher
inflation rates. Experts put more emphasis on demand-side factors, such as fiscal and monetary policy, and on supply chain disruptions. Other supply-side factors, such as labor shortages or increased energy costs, are equally prominent across
samples. Households and managers are more likely to tell generic stories related to the pandemic or mismanagement by the government. We also find that households and managers expect the increase in inflation to be more persistent than
experts. Moreover, narratives about the drivers of the inflation increase are strongly correlated with beliefs about its persistence. Our findings have implications for understanding macroeconomic expectation formation.
OriginalsprogEngelsk
Antal sider89
StatusUdgivet - 25 nov. 2021
NavnCEBI Working Paper Series
Nummer18
Vol/bind21

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