Replication data for: The Formation of Expectations, Inflation, and the Phillips Curve

Principal Investigator(s): View help for Principal Investigator(s) Olivier Coibion; Yuriy Gorodnichenko; Rupal Kamdar

Version: View help for Version V1

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Project Citation:

Coibion, Olivier, Gorodnichenko, Yuriy, and Kamdar, Rupal. Replication data for: The Formation of Expectations, Inflation, and the Phillips Curve. Nashville, TN: American Economic Association [publisher], 2018. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113915V1

Project Description

Summary: This paper argues for a careful (re)consideration of the expectations formation process and a more systematic inclusion of real-time expectations through survey data in macroeconomic analyses. While the rational expectations revolution has allowed for great leaps in macroeconomic modeling, the surveyed empirical micro-evidence appears increasingly at odds with the full-information rational expectation assumption. We explore models of expectation formation that can potentially explain why and how survey data deviate from full-information rational expectations. Using the New Keynesian Phillips curve as an extensive case study, we demonstrate how incorporating survey data on inflation expectations can address a number of otherwise puzzling shortcomings that arise under the assumption of full-information rational expectations.

Scope of Project

JEL Classification:
      D84 Expectations; Speculations
      E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
      E27 Macroeconomics: Consumption, Saving, Production, Employment, and Investment: Forecasting and Simulation: Models and Applications
      E31 Price Level; Inflation; Deflation
      E37 Prices, Business Fluctuations, and Cycles: Forecasting and Simulation: Models and Applications

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Published Versions

V1 [2019-10-12]

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