We offer a comprehensive evaluation of the welfare and cyclical implications of moderate trend inflation. In an … extended version of a medium-scale New Keynesian model, recent proposals to increase trend inflation from 2 to 4 percent would …, and iv) and the interaction between trend inflation and shocks to the marginal efficiency of investment (MEI), insofar …

appointment of Volcker marked a change in the conduct of monetary policy, but inflation dropped only when fiscal policy … accommodated this change two years later. In fact, a disinflationary attempt of the monetary authority leads to more inflation if … been confident about the switch, the Great Inflation would not have occurred and debt would have been higher. This is …

with a modest and protracted decline in inflation, following the rise in financial stress in 2008Q4. The model does so even … though inflation remains very dependent on the evolution of economic activity and of monetary policy …

application in the context of inflation, a bridge to the HANK literature, and an extension to networks …