Impact of the Ukraine War on Gas Price Expectations: New Survey Evidence from Chinese Households

26 Pages Posted: 16 Jun 2022

See all articles by Zidong An

Zidong An

Renmin University of China

Carola Binder

Haverford College - Department of Economics

Xuguang Simon Sheng

American University - Department of Economics

Date Written: May 31, 2022

Abstract

We conduct a survey of 2,500 Chinese households to study their formation of gas price expectations following the 2022 Ukraine war. Respondents provided their priors about recent and future gas price inflation. Participants were randomly exposed to information about recent gas price inflation, and some were primed to think about the Ukraine war. We then re-solicited gas price expectations, and asked respondents about their spending plans and for open-ended explanations of their responses. Both information treatments increase respondents' gas price inflation expectations by about 3 percentage points, and reduce their expectations of purchasing any of the durable goods by about 2 percentage points. However, there is not a significant difference between the post-treatment expectations of the respondents in the two treatment groups, suggesting that respondents were already aware that the Ukraine war was responsible for some of the rise in gas prices. Text analysis of households' open-ended responses reveals that households' first-order reactions center around oil and energy, followed closely by concerns about the price.

Keywords: China, Gas Prices, Inflation, Narratives, Text Analysis, War

JEL Classification: E31, E71

Suggested Citation

An, Zidong and Binder, Carola and Sheng, Xuguang Simon, Impact of the Ukraine War on Gas Price Expectations: New Survey Evidence from Chinese Households (May 31, 2022). Available at SSRN: https://ssrn.com/abstract=4129608 or http://dx.doi.org/10.2139/ssrn.4129608

Zidong An

Renmin University of China ( email )

59 Zhong Guan Cun Avenue
Hai Dian District
Beijing, 100872
China
13671168561 (Phone)
100872 (Fax)

Carola Binder

Haverford College - Department of Economics ( email )

Haverford, PA 19041
United States

Xuguang Simon Sheng (Contact Author)

American University - Department of Economics ( email )

4400 Massachusetts Avenue, N.W.
Washington, DC 20016-8029
United States

HOME PAGE: http://https://www.american.edu/cas/faculty/sheng.cfm

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
156
Abstract Views
552
Rank
349,768
PlumX Metrics