The classical theory of commodity price determination integrates myopic supply and demand on the one hand with … non-negative, this paper derives from the theory testable implications on the behavior of prices, and makes a first …

In models with complete markets, targeting core inflation enables monetary policy to maximize welfare by replicating … stabilize price movements in the flexible price sector. Also, in the presence of financial frictions, stabilizing core inflation … frictions a welfare-maximizing central bank should adopt flexible headline inflation targeting--a target based on headline …

This paper presents a prototype model for development of the fiscal theory of the price level.' In this simple setting …, the fiscal theory's distinctiveness relies upon adoption of a bubble solution, rather than the rational …