Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/236409 
Year of Publication: 
2021
Series/Report no.: 
IZA Discussion Papers No. 14378
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Introducing a new survey of U.S. firms' inflation expectations, we document key stylized facts involving what U.S. firms know and expect about inflation and monetary policy. The resulting time series of firms' inflation expectations displays unique dynamics, distinct from those of households and professional forecasters. By any typical definition of "anchored" expectations, the inflation expectations of U.S. managers appear far from anchored, much like those of households. And like households, U.S. managers are largely uninformed about recent aggregate inflation dynamics or monetary policy. These results complement existing evidence on firms' inflation expectations from other countries and confirm that inattention to inflation and monetary policy is pervasive among U.S. firms as well.
Subjects: 
expectations
surveys
anchoring
rational inattention
JEL: 
E3
E4
E5
Document Type: 
Working Paper

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