TY - UNPB
T1 - Direct Elicitation of Parametric Belief Distributions: An application to inflation expectations
AU - Gonzalez-Fernandez, Pedro
AU - Bosch-Rosa, Ciril
AU - Meissner, Thomas
PY - 2024/10/4
Y1 - 2024/10/4
N2 - We introduce a novel method to elicit belief distributions and apply it to elicit inflation expectations in a representative US sample through a pre-registered survey experiment. Our approach elicits beta belief distributions directly in a two-step process. First, participants specify their minimum and maximum expected inflation. They then use a graphical interface with two sliders to adjust the mean and variance of their inflation belief distribution. We benchmark our method against the "Bins" method, popularized by the New York Fed's Survey of Consumer Expectations (SCE). Our findings reveal significant variations in elicited belief distributions depending on the method used. Specifically, our approach yields higher mean inflation estimates and substantially reduces the standard deviations of the distributions. Respondents report that our method is easier to use, more engaging, and better allows them to express their beliefs. Furthermore, the resulting distributions more accurately reflect participants' beliefs across several dimensions and show stronger correlations with their point predictions.
AB - We introduce a novel method to elicit belief distributions and apply it to elicit inflation expectations in a representative US sample through a pre-registered survey experiment. Our approach elicits beta belief distributions directly in a two-step process. First, participants specify their minimum and maximum expected inflation. They then use a graphical interface with two sliders to adjust the mean and variance of their inflation belief distribution. We benchmark our method against the "Bins" method, popularized by the New York Fed's Survey of Consumer Expectations (SCE). Our findings reveal significant variations in elicited belief distributions depending on the method used. Specifically, our approach yields higher mean inflation estimates and substantially reduces the standard deviations of the distributions. Respondents report that our method is easier to use, more engaging, and better allows them to express their beliefs. Furthermore, the resulting distributions more accurately reflect participants' beliefs across several dimensions and show stronger correlations with their point predictions.
KW - belief elicitation
KW - Inflation expectations
KW - macroeconomic survey
U2 - 10.2139/ssrn.4943520
DO - 10.2139/ssrn.4943520
M3 - Preprint
T3 - SSRN Working papers
BT - Direct Elicitation of Parametric Belief Distributions: An application to inflation expectations
PB - SSRN
ER -