their expenditure shares when forming expectations about price inflation. We develop a simple dynamic model of the economy … for individuals to place more weight on the movement of prices in these sectors. We use survey data on expected inflation … the United States. We find food price inflation is weighted more heavily and energy price inflation is weighted less …

This paper discusses four potential sources of lag dynamics in inflation: non-rational behavior, staggered contracting …, frictions on price adjustment, and shifts in the long-run inflation anchor of agent expectations (the perceived inflation target …). Expressions for inflation dynamics from structural models which admit these different sources of lag dynamics are contrasted …

The rational expectations hypothesis for survey and model-based inflation forecasts − from the Survey of Professional … nearunit-root effects in inflation and inflation expectations motivates the use of a local-tounity specification of the … inflation process that enables us to test whether the data are generated by locally non-stationary or stationary processes. Thus …