Narratives about the Macroeconomy
Peter Andre,
Ingar Haaland,
Christopher Roth,
Johannes Wohlfart and
Ingar K. Haaland
Authors registered in the RePEc Author Service: Ingar Haaland
No 10535, CESifo Working Paper Series from CESifo
Abstract:
We provide evidence on narratives about the macroeconomy—the stories people tell to explain macroeconomic phenomena—in the context of a historic surge in inflation. We measure economic narratives in open-ended survey responses and represent them as Directed Acyclic Graphs. We apply this approach in surveys with more than 10,000 US households and 100 academic experts and document three main findings. First, households’ narratives are strongly heterogeneous and coarser than experts’ narratives, focus more on the supply side than on the demand side, and often feature politically loaded explanations. Second, households’ narratives strongly shape their inflation expectations, which we demonstrate with descriptive survey data and a series of experiments. Third, an experiment varying news consumption shows that the media is an important source of narratives. Our findings demonstrate the relevance of narratives for understanding macroeconomic expectation formation.
Keywords: narratives; expectation formation; causal reasoning; inflation; media; attention (search for similar items in EconPapers)
JEL-codes: D83 D84 E31 E52 E71 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)
Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp10535.pdf (application/pdf)
Related works:
Working Paper: Narratives about the macroeconomy (2024) 
Working Paper: Narratives about the Macroeconomy (2022) 
Working Paper: Narratives about the Macroeconomy (2022) 
Working Paper: Narratives about the Macroeconomy (2021) 
Working Paper: Narratives about the Macroeconomy (2021) 
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:ces:ceswps:_10535
Access Statistics for this paper
More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().