Work

Effects of Inflation Expectations on Inflation

Year: 2021

Type: article

Abstract: We study the effects of professionals’ survey-based inflation expectations on inflation for a large number of 36 economies, using dynamic cross-country panel estimation of New-Keynesian Phillips curves. We find that inflation expectations have a significantly positive effect on inflation. We also find that the effect of inflation expectations on inflation is significantly larger when inflation is higher. This suggests that second-round effects via the effects of higher inflation expectations on inflation are more relevant in a high-inflation environment.

Source: National Institute Economic Review

DOI: 10.1017/nie.2024.24

Author: Richhild Moessner

Institutions: Heidelberg University, Bank for International Settlements, National Institute of Economic and Social Research

Language: English

Topic: Monetary Policy and Economic Impact

Subfield: General Economics, Econometrics and Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $3,255

OpenAlex ID: W4406684555