Primary Outcomes (explanation)
For coherence, we consider bunching, proportion of intervals used per individual, and use of non-adjacent intervals. See Bover (2015).
For rounding, we will measure the proportion of individuals rounding probabilities (for example, to the nearest, 5, 10 or 25 percent). See Attanasio and Augsburg (2016).
Individual means and standard deviations of beliefs will be computed following Arellano et al. (2022a), which assumes a normal distribution, or discrete beliefs as in Pistaferri (2001). As a measure of income risk, we will compute the coefficient of variation proposed by Arellano et al (2022b).
For asymmetry measures we will turn to Basso et al. (2023).
References:
- Arellano, M., O. Attanasio, B. Augsburg, and S. Crossman (2022a). Estimating flexible income processes from subjective expectations data: evidence from colombia and india. Technical report, CEMFI.
- Arellano, Manuel, Stéphane Bonhomme, Micole De Vera, Laura Hospido, and Siqi Wei (2022b). Income Risk Inequality: Evidence from Spanish Administrative Records. Quantitative Economics, 13, .no 4, 1747-1801.
- Attanasio, O. and B. Augsburg (2016). Subjective expectations and income processes in rural india. Economica 83 (331), 416–442.
- Basso, H. S., O. Bover, J. Galvez, and L. Hospido (2023). Income uncertainty and nonlinear dynamics: A subjective expectations framework. Technical report, mimeo.
- Bover, O. (2015). Measuring expectations from household surveys: new results on subjective probabilities of future house prices. SERIEs 6 (4), 361–405.
- Pistaferri, L. (2001). Superior information, income shocks, and the permanent income hypothesis. Review of Economics and Statistics 83 (3), 465–476