Seminar Long-Run Inflation Expectations Departmental Seminar Add to calendar 2024-05-14 14:00 2024-05-14 15:15 Europe/Rome Long-Run Inflation Expectations Seminar Room 3rd Floor Villa La Fonte YYYY-MM-DD Print Share: Share on Facebook Share on BlueSky Share on X Share on LinkedIn Send by email Scheduled dates May 14 2024 14:00 - 15:15 CEST Seminar Room 3rd Floor, Villa La Fonte Organised by Department of Economics In this seminar, Leonardo Melosi (University of Warwick) will present the paper "Long-Run Inflation Expectations." We estimate a model of long-run inflation expectations using panel data from the US Survey of Professional Forecasters (SPF). Professional forecasters are affected by common persistence bias and overconfidence in private information and these two deviations from rationality allow the model to account for the striking insensitivity of long-run inflation expectations to persistent changes in inflation and the large and persistent disagreement in the SPF. Expectations respond negligibly to short-term changes in inflation and become less coordinated during the two zero-lower-bound episodes. At the end of 2022, the model correctly predicts that US long-run inflation expectations would remain stable if inflation fell in 2023 as quickly as it actually did.