Recently, some have suggested that monetary policy might be used to create expectations of higher inflation and thus to stimulate current spending. But using data from the Michigan Survey of Consumers, Rüdiger Bachmann, Tim Berg, and Eric Sims find that inflation expectations have a statistically insignificant effect on consumers’ reported readiness to spend on durable goods. In fact, their estimates suggest that if anything, higher expected price changes have a negative effect on readiness to spend, even on cars and houses.

Dean Karlan and John List teamed with a medium-sized charity focused on international development and poverty reduction to determine the importance of matching gifts and of using the Gates Foundation name as a quality signal. In two experiments applied to direct mailings, they first offered prior donors to this charity a matching grant provided by the Bill and Melinda Gates Foundation (BMGF) at a ratio of $2:$1, while a control group received no match offer. In a second experiment, they named the matching donor, the BMGF, in some letters but not others in a mailing that went only to those who had not previously donated to this charity. The researchers find that offering a $2:$1 matching grant increased both the average revenue per solicitation and the probability of an individual donating. Naming BMGF as the source of matching funds increased average revenue per solicitation by 51 percent and increased the probability of an individual donating by 26 percent among the group that had not given to this charity before. Importantly, these effects persisted long after the matching period, and the effect of the quality signal was much larger for prospective donors who had a record of giving to “poverty-oriented” charities.

Hilary Hoynes, Doug Miller, and Jessamyn Schaller examine the sensitivity of employment conditions to the business cycle during the most recent recession and compare it to earlier periods. They find that the effects of the Great Recession were felt most strongly by men, black and Hispanic workers, young people, and workers with little education. These differences can be explained mainly by variation in the sensitivity of employment to cyclical change across industries and occupations. Furthermore, the researchers find that these differences across demographic groups turn out to be remarkably stable across three decades of time, and throughout both recessionary periods and expansionary periods.