Trust in the central bank and inflation expectations: Experimental evidence

Takeshi Niizeki

Economics Letters, 2023, vol. 231, issue C

Abstract: Exploiting an exogenous variation in trust in the central bank driven by randomized information treatment, this paper examines the extent to which the trust in the central bank affects the inflation expectations in Japan. The findings are twofold. First, information provision about inappropriate statement made by the Governor of the Bank of Japan (BOJ) reduced respondents’ trust in the BOJ by about 1.11 points on a 10-point scale. Second, a one-point decrease in trust in the BOJ raised inflation expectations by 0.63 percentage points and increased the probability of the inflation expectations being outside the BOJ’s target of around 2% by four percentage points.

Keywords: Trust in the central bank; Inflation expectations; Randomized control trial (search for similar items in EconPapers)
JEL-codes: E02 E31 E52 E58 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S016517652300321X
Full text for ScienceDirect subscribers only

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:eee:ecolet:v:231:y:2023:i:c:s016517652300321x

DOI: 10.1016/j.econlet.2023.111296

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().