Arbeitspapier
Would households understand average inflation targeting?
Yes, they would. In a randomized control trial, we provide groups of respondents from the Bundesbank Online Panel Households with information about a hypothetical alternative ECB monetary policy regime akin to the Federal Reserve's flexible average inflation targeting (AIT). Inflation expectations significantly increase for the treated individuals. When provided with additional information about near-term inflation, individuals update their expected inflation path in line with the central banks' intentions. This is particularly true for individuals with high trust in the ECB. We assess the economic significance of our findings by comparing two model economies under different monetary policy strategies, calibrated to match the difference in medium-term inflation expectations from our survey results. Under AIT, inflation is substantially less volatile and the frequency of hitting the lower bound on interest rates is considerably reduced.
- ISBN
-
978-3-95729-885-0
- Sprache
-
Englisch
- Erschienen in
-
Series: Deutsche Bundesbank Discussion Paper ; No. 17/2022
- Klassifikation
-
Wirtschaft
International Monetary Arrangements and Institutions
Price Level; Inflation; Deflation
Business Fluctuations; Cycles
- Thema
-
Monetary Policy Strategy
Household Inflation Expectations
Randomized Control Trial
Survey Data
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Hoffmann, Mathias
Pavlova, Lora
Mönch, Emanuel
Schultefrankenfeld, Guido
- Ereignis
-
Veröffentlichung
- (wer)
-
Deutsche Bundesbank
- (wo)
-
Frankfurt a. M.
- (wann)
-
2022
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Hoffmann, Mathias
- Pavlova, Lora
- Mönch, Emanuel
- Schultefrankenfeld, Guido
- Deutsche Bundesbank
Entstanden
- 2022
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