This paper presents results on the convergence for hedging strategies in the setting of incomplete financial markets … trading strategy, when perfect hedging of contingent claims is infeasible, is robust under weak convergence. Several …

Episodes of unanticipated inflation reduce the real value of nominal claims and thus redistribute wealth from lenders to … borrowers. In this study, we consider redistribution as a channel for aggregate and welfare effects of inflation. We model an … inflation episode as an unanticipated shock to the wealth distribution in a quantitative overlapping-generations model of the U …

future changes in the rate of inflation. More recently, this relationship has been strengthened through the introduction of …-of-sample forecasting exercise. We find that three-regime models that allow for shifts in the inflation risk premium or real interest rate (or … both) are the most promising forecasting models of inflation when using the term structure. …

explicitly on Euro-zone inflation forecastswill diminish problems associated with the large number of country … target inflation - essentially theCzech Republic, Hungary, and Poland - should maintain this monetary policy strategy …

looking pricing account for the observed persistence in aggregate inflation. Second, price-setting responds to movements in … marginal costs, which should therefore be the driving force to observed inflation dynamics. This is not always the case in … conditions under which imposing homogeneity results in overestimating a backward-looking component in (aggregate) inflation, and …

inflation targeting than under output targeting, and that inflation risk premia are higher for policies that strike a balance … between output and inflation stability (and achieve a social optimum) than for policies that target only one of them. …

inflation, (ii) expected inflation, (iii) unexpected inflation and (iv) changes in expected inflation. Using the structural … and inflation, we find that the Mundell-Tobin model and the explanation of Fama and Gibbons (1982) are not ceompetitors …