Using a unique dataset collected through a well-established survey, which was carried out in China, we examine whether Chinese individuals are prone to money illusion. In contrast to the outcomes for US individuals, we find that the Chinese are more likely to base decisions on the real monetary value of economic transactions. We put these observed differences in findings in perspective by comparing the economic conditions in the US and China.

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Tinbergen Institute
hdl.handle.net/1765/26792
Tinbergen Institute Discussion Paper Series
Discussion paper / Tinbergen Institute
Tinbergen Institute

Mees, H., & Franses, P. H. (2011). Are Chinese Individuals prone to Money Illusion? (No. EI 2011-149/4). Discussion paper / Tinbergen Institute (pp. 1–30). Retrieved from http://hdl.handle.net/1765/26792