AUT LibraryAUT
View Item 
  •   Open Research
  • AUT Faculties
  • Faculty of Business, Economics and Law
  • AUT School of Economics
  • View Item
  •   Open Research
  • AUT Faculties
  • Faculty of Business, Economics and Law
  • AUT School of Economics
  • View Item
JavaScript is disabled for your browser. Some features of this site may not work without it.

Inflation Expectations As a Policy Tool?

Coibion, O; Gorodnichenko, Y; Kumar, S; Pedemonte, M
Thumbnail
View/Open
Journal article (832.1Kb)
Permanent link
http://hdl.handle.net/10292/13581
Metadata
Show full metadata
Abstract
We assess the prospects for central banks using inflation expectations as a policy tool for stabilization purposes. We review recent work on how expectations of agents are formed and how they affect their economic decisions. Empirical evidence suggests that inflation expectations of households and firms affect their actions but the underlying mechanisms remain unclear, especially for firms. Two additional limitations prevent policy-makers from being able to actively manage inflation expectations. First, available surveys of firms' expectations are systematically deficient, which can only be addressed through the creation of large, nationally representative surveys of firms. Second, neither households' nor firms' expectations respond much to monetary policy announcements in low-inflation environments. We provide suggestions for how monetary policy-makers could pierce this veil of inattention through new communication strategies as well as the potential pitfalls to trying to do so.
Keywords
Survey; Inflation expectations; Firms; Managers
Date
April 8, 2020
Source
Journal of International Economics (2020), Vol.124, Article 103297.
Item Type
Journal Article
Publisher
Elsevier
DOI
10.1016/j.jinteco.2020.103297
Publisher's Version
https://www.sciencedirect.com/science/article/pii/S0022199620300167?via%3Dihub
Rights Statement
© 2020 The Authors. Published by Elsevier B.V. This article is available under the Creative Commons CC-BY-NC-ND license and permits non-commercial use of the work as published, without adaptation or alteration provided the work is fully attributed.

Contact Us
  • Admin

Hosted by Tuwhera, an initiative of the Auckland University of Technology Library

 

 

Browse

Open ResearchTitlesAuthorsDateAUT School of EconomicsTitlesAuthorsDate

Alternative metrics

 

Statistics

For this itemFor all Open Research

Share

 
Follow @AUT_SC

Contact Us
  • Admin

Hosted by Tuwhera, an initiative of the Auckland University of Technology Library