https://macropaperwarehouse.com/authors/serafin-frache/Serafin FracheHugo -- gohugo.ioen-ushttps://macropaperwarehouse.com/papers/tell-me-something-i-dont-already-know-learning-in-low-and-high-inflation-settings/https://macropaperwarehouse.com/papers/tell-me-something-i-dont-already-know-learning-in-low-and-high-inflation-settings/<p>This paper uses randomized control trials (RCTs) applied over time in multiple countries to study whether the economic environment — specifically the level of inflation — affects how agents learn from new information. The main finding is that as inflation rose in advanced economies, both households and firms became more attentive to and informed about publicly available news about inflation, causing them to respond less to exogenously provided information about inflation and monetary policy in the RCT treatments. When agents are already well-informed about the current inflation environment (because high inflation makes it salient), additional information provision moves their beliefs less — the marginal value of information is decreasing in prior attentiveness. Complementary evidence from Uruguay (persistently high inflation) and New Zealand (persistently low inflation) confirms the cross-sectional pattern: agents in high-inflation environments have stronger priors and respond less to information treatments. The results imply that central bank communication interventions are more effective during low-inflation periods when agents are less informed.</p>