Inflation Expectations and Investor Behavior

Last registered on February 07, 2022


Trial Information

General Information

Inflation Expectations and Investor Behavior
Initial registration date
February 05, 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
February 07, 2022, 1:37 PM EST

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



Primary Investigator

Goethe University Frankfurt

Other Primary Investigator(s)

PI Affiliation
Goethe University Frankfurt
PI Affiliation
University of Chicago

Additional Trial Information

In development
Start date
End date
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
We use a randomized control trial on a sample of German brokerage clients to study the effect of inflation beliefs on investment choices. We first elicit inflation-related beliefs, including estimates of asset returns in past inflationary periods. To shift beliefs about inflation and how to protect against it, three treatment groups then receive two sets of information: a first treatment arm receives information on the recent inflation surge in Germany, a second arm on asset returns during historical periods of high and increasing inflation, and a third one a combination of both. One control group receives no information. Following the information provision, we test for treatment effects on inflation beliefs, asset-return expectations, and hypothetical portfolio choices. Importantly, we also use bank data to test whether the treatments feed into actual portfolio and consumption choices. The latter serves to compare our treatment effects to the existing literature linking inflation beliefs to consumption decisions. Moreover, elicitation of a wide array of additional post-treatment beliefs on the household’s expected financial situation, overall economy, and corporate outcomes allows us to pinpoint underlying mechanisms.

We also plan to investigate the role of (prior) investor beliefs about how to protect against a surge in inflation, as elicited in the survey, using observational data. We test whether we find trading consistent with these inflation-hedging beliefs shortly after announcements of inflation increases in Germany in 2021. We use portfolio-transaction data on the brokerage clients that participate in the survey as well as on a broader set of brokerage clients. For survey participants, we can use their respective inflation-hedging beliefs; for the broader set of brokerage clients, we test for portfolio choices consistent with average inflation-hedging beliefs.
External Link(s)

Registration Citation

Hackethal, Andreas , Philip Schnorpfeil and Michael Weber. 2022. "Inflation Expectations and Investor Behavior." AEA RCT Registry. February 07.
Experimental Details


Intervention Start Date
Intervention End Date

Primary Outcomes

Primary Outcomes (end points)
Survey: expectations of future inflation and future asset returns; hypothetical portfolio choices; beliefs about inflation being risk to financial markets over next 12 months

Bank data: portfolio choices, savings rate
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Survey: belief about now being a good time to purchase durable goods

Bank data: consumption decisions
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The survey begins by eliciting respondents’ recent motivations for portfolio trades (which can include changes in inflation). We then ask about perceptions of current inflation and expectations about future inflation. The pre-treatment section ends with estimations of unconditional historical asset returns, followed by historical asset returns in periods of increasing and high inflation. We interpret differences in the two return estimations as respondents’ beliefs about assets’ inflation-hedging properties. We elicit return estimates for the German stock market, German energy stocks, the US and Japanese stock markets, two- and ten-year German government bonds, a commodity index, gold, and private real estate.

Following the prior-beliefs section, we randomly allocate each respondent to one of four groups (with equal probability). The first group is a control group that is not shown any information. Group 2 receives information on the time series of inflation, on the possibility of a further increase in inflation, and on drivers of the recent increase in inflation. Group 3 receives actual returns of the German stock market, German energy stocks, the US and Japanese stock market, ten-year German government bonds, and gold in historical periods of increasing and high inflation. This treatment also includes a short summary statement on the past asset returns. Group 4 receives the information provided to group 2 and group 3.

All respondents then answer questions on their one-year- and five-year-ahead expectations about inflation, on hypothetical portfolio choices, on asset-return expectations, as well as on their expectations about risks to the German financial market, their financial situation, and economic development. We also elicit beliefs about consequences of inflation for corporate outcomes and various demographic characteristics. In the months following respondents’ survey completion, we use bank data to test for treatment effects on actual portfolio choices and savings and consumption decisions.

We hypothesize that (i) the inflation treatment increases concerns about inflation, leading respondents to adjust their asset-return expectations and portfolio choices so as to incorporate (prior) beliefs about assets’ inflation-hedging properties; (ii) the asset-return treatment induces expectations and portfolio choices that reflect the newly acquired information on the assets’ past performance during inflationary periods, at least for those concerned about inflation going forward; and (iii) the provision of information about inflation and past returns fosters effects similar to (ii), but more strongly so given increased worries about inflation.
Experimental Design Details
Randomization Method
Randomization is performed by a computer that assigns incoming subjects to different experimental arms
Randomization Unit
Was the treatment clustered?

Experiment Characteristics

Sample size: planned number of clusters
Sample size: planned number of observations
Around 4,000
Sample size (or number of clusters) by treatment arms
Around 1,000
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)

Institutional Review Boards (IRBs)

IRB Name
Gemeinsame Ethikkommission Wirtschaftswissenschaften Goethe-Universität Frankfurt
IRB Approval Date
IRB Approval Number


Post Trial Information

Study Withdrawal

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Is the intervention completed?
Data Collection Complete
Data Publication

Data Publication

Is public data available?

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials