Beyond Groceries: Financial Confidence and the Gender Gap in Inflation Expectations

Lovisa Reiche

No 11588, CESifo Working Paper Series from CESifo

Abstract: The gender gap in inflation expectations, women reporting systematically higher expectations in consumer surveys, has been attributed to traditional gender norms, and thus women’s greater exposure to volatile food prices. This overlooks a crucial factor: financial answer confidence. Using data from German households, I show that the “grocery shopping” effect occurs only among those with low answer confidence, while there is no gap among those with high answer confidence. The interaction of financial answer confidence and the shopping experience can be explained through the lens of a simple Bayesian learning framework, where noisy signals only increase mean expectations when priors are imprecise.

Keywords: consumer inflation expectations; gender; financial literacy (search for similar items in EconPapers)
JEL-codes: E31 E71 G53 (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-fle and nep-mon
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