inflation, a finding that is at odds with the assumption of constant indexation parameters in most New-Keynesian DSGE models. We … response to aggregate shocks and monetary policy. We show that workers index wages to past inflation when output fluctuations … are primarily explained by technology and permanent inflation-target shocks, whereas they index to trend inflation when …

linked to the monetary policy regime. Before and after the "Great Inflation", nominal wages moved in the same direction as … the (required) adjustment of real wages, and in the opposite direction of the price response. During the "Great Inflation … increasing inflation volatility. Using a standard DSGE model, we show that these stylized facts, in particular the estimated …

sample periods. The exchange rate equation implied by the interest rate rule that allows for interest rate and inflation …

indexation to past inflation to vary according to the monetary policy regime. We find that the extent of wage indexation is … significantly lower in an inflation targeting regime, in contrast to monetary targeting, exchange rate targeting and policy regimes …