17:00 - 18:30
Location: G07
Chair/s:
Maria Krempl
Submission 153
Pictures of You - Future Thinking and the Formation of Expectations in an Election Context
PS6-G07-04
Presented by: Maria Krempl
Yuriy Gorodnichenko 1, 3, 4, Katharina Hartinger 2Maria Krempl 2, Isabell Zipperle 2
1 UC Berkeley
2 Johannes Gutenberg-University Mainz
3 NBER
4 CEPR
We study the role of Future Thinking in economic expectation formation in the context of the 2024 US elections. Future Thinking is the ability of imagining oneself in detailed, personal, and visual future scenarios – a potentially highly relevant skill in light of the ever-growing importance of economic visions provided by candidates in election campaigns. To study the effects and determinants of Future Thinking in the political domain, we run an online survey experiment with a representative sample of more than 1,100 Americans from January 16-18, 2025 – shortly before the inauguration of Donald Trump as the 47th president of the United States. In our survey experiment, respondents in the treatment group actively engage in Future Thinking before reporting their economic expectations, while respondents in the control group do not. We stimulate Future Thinking by prompting respondents to mentally envision a specific scenario representing their personal economic situation one year after the inauguration through a series of open text fields focusing on different facets of the mental image. Preliminary findings suggest that Future Thinking does affect inflation expectations and polarization in these beliefs – with important interactions with party affiliation. Mechanism analyses are in line with Future Thinking reducing the perceived abstractness of the future.