Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/210153
Authors: 
Larsen, Vegard Høghaug
Thorsrud, Leif Anders
Zhulanova, Julia
Year of Publication: 
2019
Series/Report no.: 
Working Paper No. 5/2019
Abstract: 
We investigate the role played by the media in the expectations formation process of households. Using a novel news-topic-based approach we show that news types the media choose to report on, e.g., fiscal policy, health, and politics, are good predictors of households' stated inflation expectations. In turn, in a noisy information model setting, augmented with a simple media channel, we document that the underlying time series properties of relevant news topics explain the time-varying information rigidity among households. As such, we not only provide a novel estimate showing the degree to which information rigidities among households varies across time, but also provide, using a large news corpus and machine learning algorithms, robust and new evidence highlighting the role of the media for understanding inflation expectations and information rigidities.
JEL: 
C11
C53
D83
D84
E13
E31
E37
Persistent Identifier of the first edition: 
ISBN: 
978-82-8379-083-2
Creative Commons License: 
https://creativecommons.org/licenses/by-nc-nd/4.0/deed.no
Document Type: 
Working Paper
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