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dc.contributor.authorCurto Millet, Fabienen_US
dc.date.accessioned2009-01-28T14:59:56Z-
dc.date.available2009-01-28T14:59:56Z-
dc.date.issued2007en_US
dc.identifier.urihttp://hdl.handle.net/10419/17855-
dc.description.abstractConjectures about inflation expectations are inextricably linked to our understanding of the relationship between the real and monetary sides of the economy; yet, direct empirical research on the matter has been scarce at best. This paper therefore examines the empirical properties of inflation expectations data constructed on the basis of both qualitative and quantitative surveys of consumers for a set of eight European countries. The rational perceptions hypothesis is tested and rejected by the data, a finding which in turn leads us to reject the rational expectations hypothesis and casts doubt on the New Keynesian Phillips Curve model. The popular alternative of using ?rule-of-thumb? expectations in such models empirically is also found to be unrobust. Similarly, the conjecture by Akerlof et al. (2000) of a non-vertical long-run Phillips curve arising from the presence of ?near-rational? expectations cannot be supported. The Mankiw and Reis (2002) Phillips curve based on the idea of ?sticky information? succeeds in its intuition of a gradual adjustment of expectations, but its assumption of rational updating is challenged by the data in the context of the natural experiment provided by the UK's ERM disinflation. Instead, the adjustment mechanism for expectations appears to display largely adaptive characteristics. Finally, the paper provides some insights into the nature of the interaction between monetary policy and inflation expectations.en_US
dc.language.isoengen_US
dc.publisherKiel Institute for the World Economy (IfW) Kielen_US
dc.relation.ispartofseriesKieler Arbeitspapiere 1339en_US
dc.subject.jelD84en_US
dc.subject.jelC22en_US
dc.subject.jelE65en_US
dc.subject.jelC42en_US
dc.subject.jelE52en_US
dc.subject.jelE31en_US
dc.subject.jelE61en_US
dc.subject.jelE58en_US
dc.subject.ddc330en_US
dc.subject.keywordInflation expectationsen_US
dc.subject.keywordinflation perceptionsen_US
dc.subject.keywordsurvey dataen_US
dc.subject.keywordrationalityen_US
dc.subject.keywordPhillips curveen_US
dc.subject.keywordconsumersen_US
dc.subject.keywordexpectations distributionen_US
dc.subject.stwInflationserwartungen_US
dc.subject.stwPhillips-Kurveen_US
dc.subject.stwGeldpolitiken_US
dc.subject.stwRationales Verhaltenen_US
dc.subject.stwNew-Keynesian Phillips Curveen_US
dc.subject.stwSchätzungen_US
dc.subject.stwEuropaen_US
dc.titleInflation Expectations, the Phillips Curve and Monetary Policyen_US
dc.typeWorking Paperen_US
dc.identifier.ppn534875238en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
Appears in Collections:Kieler Arbeitspapiere, IfW
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