Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/50335
Authors: 
Lamla, Michael J.
Lein, Sarah M.
Year of Publication: 
2008
Series/Report no.: 
KOF working papers // Konjunkturforschungsstelle, Eidgenössische Technische Hochschule Zürich 201
Abstract: 
This paper analyzes the impact of the media on consumers' inflation expectations. We distinguish two channels through which media can influence expectations. First, the intensity of news coverage on inflation plays a role (volume channel). Second, the content of these reports matters (tone channel). Employing a unique data set capturing media reports on inflation in Germany comprising 01/1998-12/2006 we are able to discriminate between these two effects. We find that the volume effect generally improves the accuracy of consumer forecasts while the tone channel induces a media bias.
Subjects: 
Monetary policy
expectation formation
media coverage
media bias
JEL: 
E52
D83
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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