Financial Literacy Research Roundup: October 12, 2026

This paper investigates how households conceptualize inflation and how these qualitative narratives correlate with inflation expectations and policy preferences. Using a representative survey of over 4, 000 German households, we elicit open-ended narratives regarding the 2022–2023 inflation surge and represent them as directed acyclic graphs (DAGs) via fine-tuned large language models. We find that German households overwhelmingly interpret the inflation episode through supply-side channels and the war in Ukraine, while demand-side explanations remain comparatively rare. Beyond these aggregate patterns, inflation narratives systematically vary by financial literacy, personal economic experience, and institutional trust. Narrative structure and content correlate with inflation beliefs: supply-side narratives are associated with lower inflation expectations, whereas narratives emphasizing government action or corporate price gouging correspond to higher expectations and lower target inflation rates. A preregistered randomized information provision experiment using real-world newspaper excerpts demonstrates that exposure to news narratives significantly impacts qualitative inflation expectations, whereas quantitative expectations display greater rigidity. However, narrative exposure significantly reduces reliance on prior inflation perceptions, with treatment effects exhibiting mild heterogeneity across levels of financial literacy and prior inflation experience.

The digital revolution is a major driver of rural development in the DRC. In Mabenga, it can improve public administration, education and agriculture. The study identifies three priorities: expanding digital infrastructure, strengthening local skills and promoting inclusive digital governance adapted to rural realities, local needs and sustainable development.

What are the consequences of restoring state authority in territories governed by criminal organizations? Combining household surveys and administrative records with detailed maps of former gang-controlled areas, we study how El Salvador’s 2022 State of Exception, which ended two decades of gang territorial control, reshaped Salvadoran society. We find that the removal of gang control integrated previously segmented labor markets, improving mobility, employment outcomes, household income, and financial inclusion. Areas with greater pre-2022 gang exposure also experienced larger increases in business formation and property investment. However, the legacy of criminal governance persists through residence-based discrimination: employers remain less willing to hire otherwise identical applicants from former gang-controlled neighborhoods. Finally, although overall support for the crackdowns remains high, individuals who witnessed police abuse report substantially greater distrust of the police and the national government, suggesting that abuses of state authority may undermine the political sustainability of tough-on-crime policies.