Why Do People Dislike Inflation?

Robert Shiller

No 5539, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: A questionnaire survey was conducted to explore how people think about inflation, and what real problems they see it as causing. With results from 677 people, comparisons were made among people in the US, Germany, and Brazil, between young and old, and between economists and non-economists. Among non-economists in all countries, the largest concern with inflation appears to be that it lowers people's standard of living. Non-economists appear often to believe in a sort of sticky-wage model, by which wages do not respond to inflationary shocks, shocks which are themselves perceived as caused by certain people or institutions acting badly. This standard of living effect is not the only perceived cost of inflation among non-economists: other perceived costs are tied up with issues of exploitation, political instability, loss of morale, and damage to national prestige. The most striking differences between groups studied were between economists and non-economists. There were also important international and intergenerational differences. The US - Germany differences (on questions not just about information) were usually less strong than the intergenerational differences.

JEL-codes: E31 (search for similar items in EconPapers)
Date: 1996-04
Note: ME
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (68)

Published as Reducing Inflation: Motivation and Strategy, C. Romer and D. Romer, eds.,(Chicago: University of Chicago Press, 1997)
Published as Why Do People Dislike Inflation? , Robert J. Shiller. in Reducing Inflation: Motivation and Strategy , Romer and Romer. 1997

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Related works:
Chapter: Why Do People Dislike Inflation? (1997)
Working Paper: Why Do People Dislike Inflation? (1996)
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