Abstract
Using an original survey fielded to CUNY students during Spring 2023, and randomizing information treatments to identify exogenous variation in inflation and unemployment expectations, I will estimate whether, contemporaneously, individuals in the treatment groups place significantly less weight on their priors than do those in the control group. This analysis constitutes the first-stage estimation.
Using the exogenous information on inflation expectations from the first-stage estimation, and collecting information on students’ (1) self-reported human capital investment decisions from the survey; (2) actual human capital accumulation from CUNY administrative data; and (3) actual employment and earnings trajectories from NYS DOL, we will estimate the causal impact of inflation expectations on CUNY students’ human capital investment and employment decisions. To do so, we will rely on an instrumental variable (IV) strategy in which the information treatments from the first stage will be used to identify exogenous variation in inflation expectations.
Finally, using the exogenous information on inflation expectations from the first-stage estimation, and survey information on students’ self-reported ability to pay for bills, rent, and food, we will estimate the causal impact of inflation expectations on CUNY students perceived ability to pay a variety of different bills, rent, and food.