We develop an asset-pricing model with endogenous corporate policies that explains how inflation jointly impacts real … when inflation falls. An increase in inflation has opposite effects, but with smaller magnitudes. In the cross section, the … model predicts the negative impact of inflation on real equity values is stronger for low leverage firms. We find empirical …

institutions facing the same uncertainty. This is due to an option value of rent-seeking whereby the prospect of potentially …

This paper presents a model of monetary policy in which a rise in inflation raises uncertainty about future inflation …. When inflation is low, there is a consensus that the monetary authority will try to keep it low. When inflation is high …

representation found by Nelson and Plosser (1980) to be consistent with U. S. historical data. The impact of inflation uncertainty on … hypothesis that the initial positive real impact of anticipated money is not temporary. Inflation uncertainty is found to act as …

uncertainty over the period 1970 to 1995. We construct measures of inflation uncertainty as well as aggregate nominal and real … uncertainty. The results not only corroborate previous findings of an inverse relationship between contract duration and inflation … of this relationship to the various measures of inflation uncertainty that have appeared in the literature …

evidence supports the hypothesis that inflation uncertainty affects interest rates. Interpreted in terms of the risk neutral … model, the empirical results suggest that inflation uncertainty has a negative impact on nominal interest rates and a … when there is uncertainty about inflation rates. It is argued that even with risk neutrality the Fisherian definition of …