Modeling Inflation Expectations in the Russian Economy[Моделирование Инфляционных Ожиданий В Российской Экономике]

The study considers the following concepts of inflationary expectations: adaptive, rational, and limited rational. To quantify the inflation expectations of the population and firms obtained on the basis of surveys, apply probability, regression, balance and logistic methods. The Bank of Russia uses a probability method. We also construct series of inflation expectations of households based on the probability approach. Empirical studies on testing the method of generating inflation expectations are mainly based on methods of estimating time series. The results of their application to Russian data, detailed in the work, indicate that the hypothesis of rational expectations is not confirmed, but the inflationary expectations of Russian households and representatives of the expert community are not fully adaptive. The study found that the inflation expectations of Russian economic agents are not yet fully anchored. The Bank of Russia has the opportunity to increase the effectiveness of the inflation targeting policy by developing and implementing measures to increase the impact on inflation expectations.