Inflation expectations and cognitive uncertainty
Abstract
This paper provides a new perspective on the formation of inflation expectations based on a sample of 1036 US residents. In our information provision experiment, the participants were provided with professional forecasts of different historical accuracy and complexity. Our novel experimental design allows us to assess the influence of cognitive uncertainty while controlling for the uncertainty associated with forecasts and priors. Consistent with cognitive uncertainty we find that more complex forecasts lead to smaller updates of inflation expectation.
Fields of Study & Subjects
Decision-Making and Behavioral Economics
Complex Systems and Time Series Analysis
Forecasting Techniques and Applications
Publication details
- Journal / source
- Journal of Economic Behavior & Organization
- Publisher
- Elsevier BV
- Volume
- 244
- Pages
- 107437–107437
- Publication date
- 12 February 2026
- Language
- EN