Inflation expectations are central to economics because they affect the effectiveness of fiscal and monetary policy as … well as realized inflation. We survey the recent literature with a focus on the inflation expectations of households. We … first review standard data sources and discuss their advantages and disadvantages. We then document that household inflation …

We present new experimental evidence on heterogeneity in the formation of inflation expectations and relate the … better use of given information. Compared with survey data on inflation expectations, fewer demographic factors are … associated with variation in inflation expectations, and economic literacy in most cases accounts for demographic variation in …

that, counter to theory, the Friedman rule is not welfare improving, performing no better than a constant money regime. By …

A constant price level facilitates cooperation among firms whereas steady inflation and deflation rates lower firms …' ability to cooperate. In an experimental market with price competition we show that both inflation and deflation signicantly … welfare: depending on the market structure, inflation and deflation lead to significantly lower real prices and higher welfare. …

Poor households report significantly higher inflation expectations than rich households. We assess, both theoretically … about aggregate inflation. Using data on shopping experiences, we show that the inflation expectations of each income group … depend on the group's past grocery experiences as well as on past aggregate inflation. To explain this finding, we build a …

We study how inflation and deflation affect firms' ability to cooperate in an experimental Bertrand duopoly with … differentiated products. We find that there is significantly less cooperation in the treatments with inflation and deflation compared … to the no-inflation treatments. The difficulties to cooperate affect prices and welfare: Depending on the market …

interest rate has to respond more than one-for-one to fluctuations in the inflation rate. In our setting, the average inflation … rate fluctuates around the inflation target if the computerized central bank obeys the Taylor principle. If the Taylor … principle is violated, then the average inflation rate persistently deviates from the target. We find that these deviations from …