Gaspar, Vítor (contributor); Smets, Frank (contributor); … - 2007
level path stability (PLPS). Using a standard hybrid new Keynesian model we argue that price level stability provides a … the quasi-difference of inflation is used in the loss function, as in the hybrid new Keynesian model. Overall, the ….1 The optimality of price level stability in
the New Keynesian model 13
2.2 Price level stability, the zero lower …