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- W3034336480 abstract "With a binding effective lower bound on interest rates and large government deficits, conventional policies are unviable and policymakers resort to unconventional policies, which target households' expectations directly. Using unique micro data and a difference-in-differences strategy, we assess the effectiveness of unconventional fiscal policy and forward guidance, both of which aim to stimulate consumption via raising households' inflation expectations. All households' inflation expectations and spending plans react to unconventional fiscal policy. Instead, households, contrary to experts, do not react to forward guidance. We argue that policies aiming to affect households directly are ineffective if (non-expert) households do not understand them." @default.
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- W3034336480 date "2020-06-01" @default.
- W3034336480 modified "2023-09-25" @default.
- W3034336480 title "Managing Households' Expectations with Unconventional Policies" @default.
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- W3034336480 doi "https://doi.org/10.3386/w27399" @default.
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