%0 Journal Article %1 Easaw2013 %A Easaw, Joshy %A Golinelli, Roberto %A Malgarini, Marco %D 2013 %J European Economic Review %K expectations_formation households microdata professional_forecasters %N 0 %P - %R 10.1016/j.euroecorev.2013.02.009 %T What Determines Households Inflation Expectations? Theory and Evidence from a Household Survey %U http://www.sciencedirect.com/science/article/pii/S0014292113000330 %X Abstract The purpose of the present paper is to study how households form inflation expectations using a novel survey dataset of Italian households. We extend the existing ‘inattentiveness’ literature by incorporating explicitly inflation targets and distinguishing between aggregate and disaggregate dynamics based on demographic groups. We also consider both the short- and long-run dynamics as households update their inflation expectations. While we find clear distinctions between the various demographic groups behavior, households tend to absorb professionals forecast. The short-run dynamics also indicate they not only overreact when updating their expectations but also adjust asymmetrically to any perceived momentum change of future inflation.

@article{Easaw2013, abstract = {Abstract The purpose of the present paper is to study how households form inflation expectations using a novel survey dataset of Italian households. We extend the existing ‘inattentiveness’ literature by incorporating explicitly inflation targets and distinguishing between aggregate and disaggregate dynamics based on demographic groups. We also consider both the short- and long-run dynamics as households update their inflation expectations. While we find clear distinctions between the various demographic groups behavior, households tend to absorb professionals forecast. The short-run dynamics also indicate they not only overreact when updating their expectations but also adjust asymmetrically to any perceived momentum change of future inflation.}, added-at = {2013-03-27T17:54:23.000+0100}, author = {Easaw, Joshy and Golinelli, Roberto and Malgarini, Marco}, biburl = {https://www.bibsonomy.org/bibtex/2a286cfd6f018671b93e5ddbd4d935ef1/jp}, description = {ScienceDirect.com - European Economic Review - What Determines Households Inflation Expectations? Theory and Evidence from a Household Survey}, doi = {10.1016/j.euroecorev.2013.02.009}, interhash = {7d807849a48daebe2528af8024759cc4}, intrahash = {a286cfd6f018671b93e5ddbd4d935ef1}, issn = {0014-2921}, journal = {European Economic Review}, keywords = {expectations_formation households microdata professional_forecasters}, number = 0, pages = { - }, timestamp = {2013-05-08T23:18:35.000+0200}, title = {What Determines Households Inflation Expectations? Theory and Evidence from a Household Survey}, url = {http://www.sciencedirect.com/science/article/pii/S0014292113000330}, year = 2013 }