Complexity in Central Bank Communications

Last registered on September 19, 2022
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Pre-Trial

Trial Information

General Information

Title
Complexity in Central Bank Communications
RCT ID
AEARCTR-0010080
Initial registration date
September 17, 2022

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
September 19, 2022, 4:29 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
United States of America
Region

Primary Investigator

Name
Frederico Godinho
Affiliation
University of Texas at Austin
Contact Primary Investigator

Other Primary Investigator(s)

Additional Trial Information

Status
Completed
Start date
2022-02-25
End date
2022-03-11
Keywords
Governance
Additional Keywords
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Using data from a new small-scale survey ran under a Randomized Control Trial (RCT) framework, I measure the differences in treatment effects that come from different FOMC statements that express the same message, only changing the level of complexity in the choice of words used. The three treatments are based on the actual FOMC statement from December 15, 2021, and express the same message; however, the first treatment (T1) expresses the message with simplified language, and the third treatment (T3) with complex language. The second treatment (T2) is the actual FOMC statement.

I am consequently able to look at how the general public, a non-specialized audience, reacts to distinct policy statements that only differ in the complexity of the words used. For this audience, a simpler message is more effective in shaping households’ expectations and enhancing understanding, but less effective in stimulating trust in the central bank.
External Link(s)

Registration Citation

Citation
Godinho, Frederico. 2022. "Complexity in Central Bank Communications." AEA RCT Registry. September 19. https://doi.org/10.1257/rct.10080-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2022-02-25
Intervention End Date
2022-03-11

Primary Outcomes

Primary Outcomes (end points)
Understanding of central bank communications; engagement with the central bank; inflation expectations; GDP growth expectations
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The survey was ran in March 2022, and it is divided in three parts: pre-treatment questions, presentation of treatment, and post-treatment questions. The three treatments are based on the actual FOMC statement from December 15, 2021, and express the same message; however, the first treatment (T1) expresses the message with simplified language, and the third treatment (T3) with complex language. The second treatment (T2) is the actual FOMC statement. The respondents were randomly assigned to one of four groups: T1, T2, T3 or control group, to whom no statement was shown.
Experimental Design Details
Randomization Method
Randomization done by a computer.
Randomization Unit
Individual.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
1
Sample size: planned number of observations
2000
Sample size (or number of clusters) by treatment arms
500 per group (Treatment 1, Treatment 2, Treatment 3, Control)
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
Analysis Plan

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials