Measuring Inflation Expectations: How the Response Scale Shapes Density Forecasts

Christoph Becker, Peter Duersch and Thomas Eife
Authors registered in the RePEc Author Service: Peter Dürsch

No 723, Working Papers from University of Heidelberg, Department of Economics

Abstract: In density forecasts, respondents are asked to assign probabilities to pre-specified ranges of inflation. We show in two large-scale experiments that responses vary when we modify the response scale. Asking an identical question with modified response scales induces different answers: Shifting, compressing or expanding the scale leads to shifted, compressed and expanded forecasts. Mean forecast, uncertainty, and disagreement can change by several percentage points. We discuss implications for survey design and how central banks can adjust the response scales during times of high inflation.

Keywords: density forecast; Inflation; Experiment (search for similar items in EconPapers)
Date: 2023-01-13
New Economics Papers: this item is included in nep-ban, nep-exp and nep-mon
Note: This paper is part of http://archiv.ub.uni-heidelberg.de/volltextserver/view/schriftenreihen/sr-3.html
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://nbn-resolving.de/urn:nbn:de:bsz:16-heidok-326775 Frontdoor page on HeiDOK (text/html)
https://archiv.ub.uni-heidelberg.de/volltextserver ... _Eife_2023_dp723.pdf (application/pdf)

Related works:
Working Paper: Measuring Inflation Expectations: How the Response Scale Shapes Density Forecasts (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:awi:wpaper:0723

Access Statistics for this paper

More papers in Working Papers from University of Heidelberg, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Gabi Rauscher ( this e-mail address is bad, please contact ).