We present a model in which inflation has a systematic effect on relative prices and welfare. The model focuces on the microeconomics of trade under inflation, and in particular, the role of long-term trading relationships in markets characterized by imperfect information.

Low rates of inflation have been recorded in the United States in recent years despite a decline in the unemployment rate. This phenomenon could be the results of a series of transitory shocks or of a permanent charge in the structure of the economy leading to a lower NAIRU. The paper suggests...

In this paper, we characterize conditions under which interest rate feedback rules wherby the nominal interest rate is set as an increasing function of the inflation rate generate multiple equilibria. We show that these conditions depend not only on the fiscal regime (as emphasized in the fiscal...

In the case of the consumer price index the importance of a seasonally adjusted measure lies in the possibility of promptly identifying turning points in inflation. The focus of this paper is the so-called "cost-of-living" index, the most used measure of Italian inflation. Our aim is to identify...