Indirect Consumer Inflation Expectations and Income Expectations

Last registered on March 10, 2022

Pre-Trial

Trial Information

General Information

Title
Indirect Consumer Inflation Expectations and Income Expectations
RCT ID
AEARCTR-0009062
Initial registration date
March 07, 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
March 10, 2022, 9:16 PM EST

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

Locations

Region

Primary Investigator

Affiliation
Federal Reserve Bank of Cleveland

Other Primary Investigator(s)

PI Affiliation
Federal Reserve Bank of Cleveland
PI Affiliation
Federal Reserve Bank of Cleveland
PI Affiliation
Federal Reserve Bank of Cleveland
PI Affiliation
Brandeis University
PI Affiliation
Morning Consult

Additional Trial Information

Status
In development
Start date
2021-12-01
End date
2022-06-04
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
In this study, we try to understand the relationship between inflation expectations and wage expectations. Using a novel and large-scale survey of inflation expectations for the US, we treat respondents with information regarding wage growth and inflation to investigate the causal relationship between inflation expectations and wage expectations. We want to evaluate how changes in inflation expectation changes wage expectations from consumers.
External Link(s)

Registration Citation

Citation
Hajdini, Ina et al. 2022. "Indirect Consumer Inflation Expectations and Income Expectations." AEA RCT Registry. March 10. https://doi.org/10.1257/rct.9062
Experimental Details

Interventions

Intervention(s)
Information treatment about past inflation, inflation forecast from professional forecasters, Fed target, and income expectations. We include a placebo and control group
Intervention Start Date
2022-03-07
Intervention End Date
2022-03-13

Primary Outcomes

Primary Outcomes (end points)
Inflation expectations, income expectations and its causal relationship
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Whether respondents will actively look ask for a raise, look for a new job or work more hours.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
After getting priors on inflation expectations and income expectations, we will treat respondents with information about past inflation, inflation forecast from professional forecasters, Fed target, and wage growth expectations. We will also give information treatment about expected income growth. Then, we will see how treated change their inflation and income expectations
Experimental Design Details
We start by asking inflation expectations for consumers and expected income inflation one year ahead, we then give to a random group 5 sets of treatments, leaving one control group. The treatments are:

-The Federal Reserve targets an inflation rate of 2% per year in the long run.
-A recent survey from The Conference Board found that wages were expected to rise 3.9% in 2022.
-Between January 2021 and January 2022, the Consumer Price Index (CPI), which measures the average change in prices over time that consumers pay for goods and services, showed the inflation rate in the U.S. was 7.5%.
-According to the Survey of Professional Forecasters, the Consumer Price Index (CPI), which measures the average change in prices over time that consumers pay for goods and services, showed the inflation rate will be 3.7% by the end of 2022.
-According to the U.S. Census Bureau, the United States population was 332,402,978 as of December 31, 2021

We then use a other questions to see how they update information. First, a question of price inflation expectations in general and second a question of income expectations at different horizons. We finally ask questions related to the mechanism, in particular to see whether consumers plan to increase their income actively.
Randomization Method
Randomization done in a office by a computer
Randomization Unit
Individuals
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
no clusters
Sample size: planned number of observations
6600 repondents
Sample size (or number of clusters) by treatment arms
1100 by treatment and 1100 in the control group
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number

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