engleski

An empirical assessment of the expected inflation quantification methods : a pan-European study

This article analyses the consumers’ inflation expectations in 24 individual European Union countries. Based on Consumer Survey data, the authors employ three different quantification techniques (Carlson-Parkin, nonlinear regression approach and a Bachelor-type indicator) in order to obtain a numerical indicator of expected inflation. For each observed country the three stated estimators are compared in terms of their forecasting accuracy with regards to actual inflation dynamics. That way the “optimal” indicator is chosen for each country. Additionally, the paper empirically tests whether the extracted inflation expectations are rational (in the sense of unbiasedness). The obtained results to a large extent point to the conclusion that European consumers are not able to produce unbiased estimates of future inflation dynamics.

expected inflation ; quantification methods ; rational expectations ; Carlson-Parkin method

nije evidentirano