Not logged in.
Quick Search - Contribution
Contribution Details
| Type | Working Paper |
| Scope | Discipline-based scholarship |
| Title | Beyond the headline: how personal inflation exposure shapes households’ financial choices |
| Organization Unit | |
| Authors |
|
| Language |
|
| Institution | Swiss Finance Institute |
| Series Name | Swiss Finance Institute Research Paper |
| Number | 23-15 |
| ISSN | 1556-5068 |
| Number of Pages | 43 |
| Date | 2023 |
| Abstract Text | Using unique account-level data from a high inflation period in Estonia in 2005-11 and interactive fixed effect estimation, we find individual consumption to depend on personal beyond national headline inflation. Foreign shocks to selected goods’ inflation affect disproportionately households with greater consumption basket weights on these goods and make them increase consumption by an extra 1.3% per percentage point of higher inflation exposure, financed with more net borrowing. Indebted households respond stronger, consistent with a debt depreciation effect. Resulting extra demand for goods with higher inflation can reinforce inflation, letting future inflation depend on its current distribution. |
| Related URLs | |
| Other Identification Number | merlin-id:23533 |
| PDF File |
Download from ZORA
|
| Export |
BibTeX
EP3 XML (ZORA)
|
| Keywords | Inflation heterogeneity, personal inflation exposure, consumption, borrowing, interactive fixed effects, intertemporal choices |