Firms are allowed to use aggregate data on market salaries to set pay, a practice known as salary benchmarking. Using national payroll data, we study firms that gain access to a tool that reveals market benchmarks for each job title. Using a difference-in-differences design, we find that the benchmark information reduces salary dispersion by 25%. Thus, salary dispersion must stem partly from aggregate uncertainty about the salaries offered by other firms. Our model formalizes how salary dispersion can arise even in competitive labour markets for identical workers when such uncertainty exists, and we discuss implications for an ongoing policy debate.

We examine how macroeconomic expectations affect consumer decisions, using an experiment with 2,872 credit card customers at a large commercial bank. In the experiment, participants are randomized into receiving expert forecasts of inflation and the nominal exchange rate. We find that forecasts shift inflation and exchange rate expectations, but do not change spending or self-reported consumption plans as predicted by standard models of intertemporal choice. Results from a supplementary survey experiment suggest that consumers are sophisticated enough to anticipate nominal rigidities and reduce spending on durables for precautionary reasons, counteracting the effects predicted by standard models of intertemporal optimization.