Expectations and the housing market: A model of house price dynamics

We examine the characteristics of housing markets under adaptive and heterogeneous expectations. Model agents have finite horizons, and their borrowings are constrained by the collateral value of housing stock. Our model shows that expectation-driven housing price dynamics constantly change the direction of movement. The steady-state process of housing prices follows an endogenous oscillation process, and the magnitude of the cycles can be amplified by external shocks. Our quantitative results imply that (i) short-term positive and long-term negative serial correlations in housing price changes are inherent, (ii) house prices and expected house price movements are positively correlated, and (iii) fluctuations in housing prices are not fully explained by fundamentals.     

Predicting future consumer purchases in grocery retailing with the condensed Poisson lognormal model

To identify the effect of marketing actions on consumer purchasing, analysts must disentangle the dynamic component of purchasing from expected period-to-period stochastic fluctuations. This is done by comparing marketplace observations to the conditional expectation of future purchasing. Current methods of deriving the conditional expectation contain systematic bias and rely on certain unrealistic modelling assumptions. We therefore propose a new model to predict future consumer purchases in grocery retailing. The new model is a mixture of Erlang-2, Poisson and lognormal distributions or a condensed Poisson lognormal model (CPLN). Using two grocery retailing datasets from the UK, we demonstrate that the CPLN model predicts future consumer purchases well with error of 7% and 9%, respectively. Compared with the previous benchmark model, the condensed Negative Binominal Distribution (CNBD), the CPLN model reduces error by 50% (7% versus 14%) and 67% (9% versus 27%), respectively. Theoretical and practical implications for retailers are discussed.     

Investigating young adults' use of Internet credit services: A reflective-impulsive dual-process model

While Internet credit services are proliferating fast, they bring serious debt problems, especially to young adults, and further result in negative psychological and social issues. The present study aims to investigate the influential factors underlying the usage of Internet credit services among young adults. Particularly, a dual-process model is proposed by integrating both the reflective and impulsive decision-making process. While the reflective process is modelled based on the theory of planned behaviour, the impulsive process is manifested by examining the antecedents of impulse to use Internet credit services, including immediate gratification, materialism, and self-control. A survey was administered among young adults and 992 valid questionnaires were collected. PLS-SEM methods were applied to analyse the data. It was revealed that the reflective decision-making process exerts significant influence on young adults' usage of Internet credit services, and the impulsive process plays important role in impacting people's usage of Internet credit services among the lower income group. In addition, immediate gratification and materialism were found to positively affect the impulse to use, whereas self-control was identified as an inhibitor of impulse to use Internet credit services. Implications of the finding are discussed at the end of the paper.     

It is different than what I saw online: Negative effects of webrooming on purchase intentions

Webrooming is a two-stage shopping process that begins with examining product options online followed by making a purchase at an offline store. In four experiments, we investigate webrooming effects on product evaluation and purchase intentions. The results suggest that webrooming (vs. non-webrooming) has negative impacts on (1) perceived product performance vis-à-vis expectations and (2) purchase intentions for the products offline. Our moderated-mediation analyses show that webrooming leads to lower perceived product performance, which in turn results in lower purchase intentions, and participants’ Need for Touch (NFT) moderates the negative mediation effect, which is stronger with instrumental NFT than autotelic NFT. However, this moderated-mediation effect is attenuated when products are searched across multiple categories. These findings contribute to the marketing literature by providing a more nuanced understanding of how two-stage, webrooming behavior affects consumers’ cognitions and purchase decisions. They also provide several managerial implications that when controlling for time intervals between the stages, (1) webrooming may adversely affect retailers’ business outcomes when webrooming within a single (e.g., blankets), related (e.g., baby products), and unrelated product categories; (2) thus, creating an integrated online-to-offline cross-channel customer experiences is critical to minimize the negative webrooming effects on final sales.     

Inflation Expectations,Inflation Target Credibility,and the COVID-19 Pandemic: Evidence from Germany

Using the exact wording of the European Central Bank's definition of price stability, we started a representative online survey of German citizens in January 2019 that is designed to measure long-term inflation expectations and the credibility of the inflation target. Our results indicate that credibility has decreased in our sample period, particularly in the course of the deep recession implied by the Covid-19 pandemic. Interestingly, even though inflation rates in Germany have been clearly below 2% for several years, credibility has declined mainly because Germans increasingly expect that inflation will be much higher than 2% over the medium term. We investigate how inflation expectations and the impact of the pandemic depend on personal characteristics including age, gender, education, and political attitude.     

货币政策预期管理对抑制商业银行资金同业空转的作用——基于德格鲁特模型的预期构建分析

从货币政策预期管理的角度出发,采用德格鲁特模型构建货币政策一致性预期,以2015年1月—2020年9月商业银行同业业务规模月度数据为样本,研究货币政策预期管理能否抑制商业银行资金同业空转。实证结果表明:央行对公众和研究机构的货币政策预期管理均能有效抑制商业银行资金同业空转;随着央行逐渐增加对公众和研究机构的预期管理力度,货币政策预期管理抑制商业银行资金同业空转的效果分别是增强和减弱的;在央行货币政策预期管理力度较大的情况下,央行对公众进行预期管理能更有效地抑制商业银行资金同业空转。     

How does environmental quality perception influence people's fertility intention? Evidence from China

The ongoing population aging and few children are major challenges for human sustainable development in the 21st century. While the external environment is a crucial factor determining people's behaviour, the potential effects of subjective environmental quality on an individual's fertility decision-making remain poorly understood. Using data from the Chinese General Social Survey, this research has examined the relationship between environmental quality perception and fertility intention in China. Results reveal that an increase in environmental quality perception can significantly promote people's fertility intention. Our study proposes and verifies two pathways through which environmental quality perception affects fertility intention, namely, well-being and future expectation. This facilitating effect is greater for people with poor socio-economic conditions. The findings indicate that policymakers should coordinate environmental protection and population policies to promote sustainable development and design various tools targeted based on people's socio-economic background.     

The Formation of Inflation Expectations: Microdata Evidence from Japan

We propose a novel approach for measuring inflation expectations, which can alleviate the rounding number problem. Furthermore, we examine how consumers form inflation expectations. We find that consumers heterogeneously update their information sets on prices; 46% of the consumers collect information about the consumer price index at least once a quarter, while the remaining consumers less frequently or never obtain this information. We also find that forecast revisions are sensitive to a change in food prices. More than half of consumers are attentive only to a change in food prices and may form their inflation expectations using food price changes as a signal of fluctuations in the overall inflation rates. The existence of consumers who are inattentive to aggregate inflation casts doubt on the transmission of monetary policy through the management of expectations.     

Perceived economic prospects during the early stage of COVID-19 breakout

How does a new epidemic affect individuals' expectations on economic prospects in the early stage of the breakout? We implemented an incentivized longitudinal online survey soon after the outbreak of the coronavirus disease 2019 (COVID-19) epidemic in China to answer this question. Results show that fewer new confirmed COVID-19 cases significantly increase individuals' expectations on gross domestic product and consumer price index growth rates. Our finding provides evidence that at the early stage of an unfamiliar epidemic, containing the spread of the disease may help to maintain positive economic expectations among individuals.     

Disagreement in Consumer Inflation Expectations

By carefully matching the data sets from the Michigan Survey of Consumers with the Survey of Professional Forecasters, we show that there exists substantial heterogeneity in the propensity of U.S. households to learn from experts in forming inflation expectations. Additional results for a group of European economies broadly confirm this observation. We advance an extended version of the sticky-information model to analyze disagreement in consumer inflation expectations. Besides differences in consumers' propensities to learn, disagreement in our model arises from heterogeneity in consumers' fundamental inflation and past expectations and experts' different views about future inflation.