Measuring the Distributions of Public Inflation Perceptions and Expectations in the UK

Yasutomo Murasawa

MPRA Paper from University Library of Munich, Germany

Abstract: The Bank of England/GfK NOP Inflation Attitudes Survey asks individuals about their inflation perceptions and expectations in eight ordered categories with known boundaries except for an indifference limen. With enough categories for identification, one can fit a mixture distribution to such data, which can be multi-modal. Thus Bayesian analysis of a normal mixture model for interval data with an indifference limen is of interest. This paper applies the No-U-Turn Sampler (NUTS) for Bayesian computation, and estimates the distributions of public inflation perceptions and expectations in the UK during 2001Q1--2015Q4. The estimated means are useful for measuring information rigidity.

Keywords: Bayesian; Indifference limen; Information rigidity; Interval data; Normal mixture; No-U-turn sampler (search for similar items in EconPapers)
JEL-codes: C11 C25 C46 C82 E31 (search for similar items in EconPapers)
Date: 2017-01-16
New Economics Papers: this item is included in nep-cba, nep-ecm, nep-mac and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:76244

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