Ahrens, Steffen; Snower, Dennis J. - C.E.P.R. Discussion Papers - 2012
positive long-run relation between inflation and output (and employment), for low inflation rates. This Phillips curve relation …, together with an inefficient zero-inflation steady state, provides a rationale for a positive long-run inflation rate. Given … standard calibrations, optimal monetary policy is associated with a long-run inflation rate around 2 percent. …