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The Double-Digit Trigger: Estimating Inflation Attention Thresholds in Ukraine Using Parliamentary Speeches

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  • Maksym Homeniuk

    (National Bank of Ukraine)

Abstract

This paper estimates Ukraine's inflation attention threshold using a text-based proxy derived from the relative frequency of the word "inflation" in parliamentary speeches. During a relatively stable macroeconomic period between 2017 and 2022, the estimated threshold is approximately 9-10 percent. This finding aligns with results obtained using Google Trends data, where attention increased just prior to inflation reaching double-digit levels. Crucially, the parliamentary proxy also facilitates estimation for another stable period preceding the global financial crisis (2002-2007). The remarkably similar threshold estimates across both stable periods suggest that attention dynamics in Ukraine exhibit structural consistency under non-crisis conditions. These findings underscore the value of parliamentary speech analysis as a robust tool for tracking inflation salience in contexts with limited data availability.

Suggested Citation

  • Maksym Homeniuk, 2025. "The Double-Digit Trigger: Estimating Inflation Attention Thresholds in Ukraine Using Parliamentary Speeches," IHEID Working Papers 14-2025, Economics Section, The Graduate Institute of International Studies.
    • Handle: RePEc:gii:giihei:heidwp14-2025
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    File URL: http://repec.graduateinstitute.ch/pdfs/Working_papers/HEIDWP14-2025.pdf
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    References listed on IDEAS

    as
    1. Sims, Christopher A., 2003. "Implications of rational inattention," Journal of Monetary Economics, Elsevier, vol. 50(3), pages 665-690, April.
    2. Oliver Pfauti, 2023. "The Inflation Attention Threshold and Inflation Surges," Papers 2308.09480, arXiv.org, revised Aug 2024.
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    Keywords

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    JEL classification:

    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E71 - Macroeconomics and Monetary Economics - - Macro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on the Macro Economy

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