We study how changes in the value of the steady-state real interest rate affect the optimal inflation target, both in …-for-one: increases in the optimal inflation rate are generally lower than declines in the steady-state real interest rate. Our approach … allows us not only to assess the uncertainty surrounding the optimal inflation target, but also to determine the latter while …

If inflation expectations become firmly anchored at the inflation target even when average inflation deviates from the … target, the long-run Phillips curve becomes non-vertical. During 1997-2011, average inflation expectations in Sweden have … been close to the inflation target of 2 percent, whereas average inflation has fallen short of the target by 0.6 percentage …

inflation expectations. We develop this measure using assumptions common in economic analysis of open economies. Using quarterly …

The paper provides an integrated analysis of globalization effects on the inflation-output tradeoff and monetary policy … flatten the Phillips curve, the tradeoff between inflation and activity. Second, the same globalization forces lead the … welfare-based monetary policy to be more aggressive with regard to inflation fluctuations, and at the same time, more benign …

inflation and activity. If policy makers are guided by the welfare criterion of the representative household, globalization … forces also lead monetary policy to be more aggressive with regard to inflation fluctuations but, at the same time, more …

A relation between inflation and the path of average marginal cost (often measured by unit labor cost) implied by the … is shown to again take the standard "new-Keynesian" form, but with an elasticity of inflation with respect to real …

perspective on the linkages among monetary policy, inflation, and the business cycle. It is argued that the adoption of an …

This paper advances the hypothesis that the transition from there-is-little-central-banks-can-do-to-control-inflation … to inflation targeting occurred because central banks, especially the Federal Reserve, demonstrated that central banks … can control inflation rather than a consequence of marked improvement in the professions understanding of how monetary …