Can the aging process affect inflation? The prolonged decline of fertility and mortality rates induces a persistent … downward pressure on the natural interest rate. If this development is not internalized by the monetary policy rule, inflation … inflation found in the data for the euro area. In this model, continuing to follow the same rule makes inflation to be on a …

This paper studies optimal discretionary policy with parameter uncertainty about inflation inertia. Optimal policy … in the presence of uncertainty about inflation inertia, depending on the form of the central bank’s objective function …. Moreover, in the cases where optimal policy is not certainty equivalent, we find that inflation returns slightly more gradually …

qualitative and quantitative information on subsequent inflation. The usefulness of monetary analysis is contrasted to weaknesses … in modeling monetary policy and inflation with respectively short-term interest rates and real activity measures. The … analysis sheds light on the recent change in inflation volatility and persistence as well as on the Phillips curve flattening …

Assigning a discretionary central bank a mandate to stabilize an average inflation rate—rather than a period …-by-period inflation rate—increases welfare in a New Keynesian model with an occasionally binding lower bound on nominal interest rates … inflation targeting (AIT) is equivalent to price level targeting (PLT). However, AIT with a finite, but sufficiently long …

that a simple optimized commitment rule with the nominal interest rate responding to current inflation and the real wage …

properties of feedback interest rate rules by guaranteeing inflation stabilization …