Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159681
Authors: 
Easaw, Joshy
Golinelli, Roberto
Malgarini, Marco
Year of Publication: 
2012
Series/Report no.: 
Quaderni - Working Paper DSE 842
Abstract: 
The purpose of the present paper is to study how households form inflation expectations. Using a novel survey-base dataset of Italian households' opinions of inflation we investigate two separate, but related, types of behavior: 'inattentiveness' and 'anchoring'. The present analysis extends the existing literature by incorporating explicitly inflation targets and distinguishing between aggregate and disaggregate dynamics based on demographic groups. In addition, we extend the literature by considering both the short- and long-run dynamics as households update their inflation expectations while also accounting for their state-varying behavior. All these issues provide important insights into understanding actual inflation dynamics and the conduct of monetary policy.
JEL: 
D1
D84
E1
E31
C33
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc/3.0/
Document Type: 
Working Paper

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