Tell me something I don’t already know: learning in low and high-inflation settings

Michael Weber, Bernardo Candia, Hassan Afrouzi, Tiziano Ropele, Rodrigo Lluberas, Serafin Frache, Brent Meyer, Saten Kumar, Yuriy Gorodnichenko, Dimitris Georgarakos, Olivier Coibion, George Ponce and Geoff Kenny

No 2914, Working Paper Series from European Central Bank

Abstract: Using randomized control trials (RCTs) applied over time in different countries, we study whether the economic environment affects how agents learn from new information. We show that as inflation rose in advanced economies, both households and firms became more attentive and informed about publicly available news about inflation, leading them to respond less to exogenously provided information about inflation and monetary policy. We also study the effects of RCTs in countries where inflation has been consistently high (Uruguay) and low (New Zealand) as well as what happens when the same agents are repeatedly provided information in both low-and high-inflation environments (Italy). Our results broadly support models in which inattention is an endogenous outcome that depends on the economic environment. JEL Classification: E3, E4, E5

Keywords: inattention; inflation expectations; RCTs (search for similar items in EconPapers)
Date: 2024-03
New Economics Papers: this item is included in nep-ban and nep-mon
Note: 483508
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Tell Me Something I Don't Already Know: Learning in Low‐ and High‐Inflation Settings (2025)
Working Paper: Tell Me Something I don't Already Know: Learning in Low and High-inflation Settings (2023)
Working Paper: Tell Me Something I Don't Already Know: Learning in Low- and High-Inflation Settings (2023)
Working Paper: Tell Me Something I Don't Already Know: Learning in Low and High-Inflation Settings (2023)
Working Paper: Tell Me Something I Don’t Already Know: Learning in Low and High-Inflation Settings (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbwps:20242914

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