Monetary Policy Communication and Social Identity: Evidence from a Randomized Control Trial

Takuya Iinuma, Yoshiyuki Nakazono and Kento Tango
Additional contact information
Takuya Iinuma: Yokohama City University and Analyst, Sumitomo Mitsui Trust Asset Management Co., Ltd. (E-mail: m245161a@yokohama-cu.ac.jp)
Yoshiyuki Nakazono: Professor, Yokohama City University and Visiting Professor, Tohoku University (E-mail: nakazono@yokohama-cu.ac.jp)
Kento Tango: Visiting Lecturer, Yokohama City University (E-mail: m225162a@yokohama-cu.ac.jp)

No 25-E-05, IMES Discussion Paper Series from Institute for Monetary and Economic Studies, Bank of Japan

Abstract: This paper investigates how social identity influences the assimilation of monetary policy information. We conduct a randomized control trial in Japan to test whether consumers respond more strongly to inflation forecasts from the Bank of Japan (BOJ) when the message is delivered by a narrator who shares their social identity. Respondents are randomly assigned to hear the BOJ's forecast in either standard Japanese or the Osaka dialect, both narrated by a female speaker. We find that individuals are significantly more likely to revise their inflation expectations toward the BOJ's forecast when the narrator shares the respondent's gender, dialect, or political alignment. Women are more responsive to forecasts delivered by a female narrator; Osaka residents react more strongly to messages in the Osaka dialect; and government supporters exhibit greater belief updating in response to BOJ forecasts. These findings suggest that central banks can enhance the effectiveness of their communication by tailoring messages to align with the social identities of target audiences.

Keywords: homophily; imperfect information; inattention; monetary policy; policy communication; political preferences; social identity (search for similar items in EconPapers)
JEL-codes: D84 E31 E52 E58 E71 (search for similar items in EconPapers)
Date: 2025-07
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.imes.boj.or.jp/research/papers/english/25-E-05.pdf (application/pdf)

Related works:
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:ime:imedps:25-e-05

Access Statistics for this paper

More papers in IMES Discussion Paper Series from Institute for Monetary and Economic Studies, Bank of Japan Contact information at EDIRC.
Bibliographic data for series maintained by Kinken ().