IDEAS home Printed from https://ideas.repec.org/a/taf/macfem/v19y2026i2p251-278.html

Reading consumers’ minds: an analysis of inflation expectations

Author

Listed:
  • Purnima Shaw

Abstract

The heterogeneity in households’ consumption baskets is often deemed responsible for deviation of their inflation expectations from headline inflation. The paper verifies this by simulating population baskets and estimating mean inflation by sampling baskets. The estimated mean inflation fails to display closeness with survey numbers. Therefore, the paper proposes alternative logical methods for designing basket compositions and identifies the most suited method using which the estimated expectations are found to be close to and well-correlated with survey numbers. The findings suggest that a sudden rise in inflation of regular-use items can explain the deviation in households’ expectations from official inflation.

Suggested Citation

  • Purnima Shaw, 2026. "Reading consumers’ minds: an analysis of inflation expectations," Macroeconomics and Finance in Emerging Market Economies, Taylor & Francis Journals, vol. 19(2), pages 251-278, May.
    • Handle: RePEc:taf:macfem:v:19:y:2026:i:2:p:251-278
    DOI: 10.1080/17520843.2024.2352955
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/17520843.2024.2352955
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/17520843.2024.2352955?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:macfem:v:19:y:2026:i:2:p:251-278. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/REME20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.