chooses to stabilize wage inflation at the expense of price inflation, a policy resembling the policy that is optimal in the …

active monetary policy by pursuing inflation and output stability over the entire post-war period. Even after accounting for … productivity and cost shocks that de-anchored inflation expectations, propagated via self-fulfilling inflation expectations and … constituted the primary sources of the run-up in inflation from the 1960s through the late 1970s …

to maintain reputation outweighs the short-run incentive to close consumption and inflation gaps, keeping the central …

between the inflation-target parameter in the monetary policy rule and the risky steady state (RSS) of inflation---the rate to … which inflation will eventually converge---which can be undesirable in some practical applications. We propose a simple … of the rule is modified so that the RSS of inflation equals the inflation-target parameter in the policy rule …

factor process reduces consumption, inflation, and output by a substantially larger amount when the zero lower bound is …

policy rate will become constrained in the future lowers today's inflation by creating tail risk in future inflation and thus … reducing expected inflation. In an empirically rich model calibrated to match key features of the U.S. economy, we find that … the tail risk induced by the ELB causes inflation to undershoot the target rate of 2 percent by as much as 45 basis points …