and the inflation rate without error, then it is typically optimal to respond infinitely strongly to observed deviations … from the central bank's targets. If it observes inflation and the output gap with error, the central bank will temper its … terms of estimated output and inflation then it is optimal to respond infinitely strongly to estimated deviations from the …

interest on reserves. While their effects on output and inflation are small, these policies require major adjustments in the …

If inflation expectations become firmly anchored at the inflation target even when average inflation deviates from the … target, the long-run Phillips curve becomes non-vertical. During 1997-2011, average inflation expectations in Sweden have … been close to the inflation target of 2 percent, whereas average inflation has fallen short of the target by 0.6 percentage …

. Specifically, we estimate a series of simple models to measure the impact of inflation targeting on the dispersion of private … sector forecasts of inflation. Using a panel data set that includes 15 countries over 20 years we find no convincing evidence … that adopting an inflation targeting regime leads to a reduction in the dispersion of private sector forecasts of inflation …

The new-Keynesian, Taylor-rule theory of inflation determination relies on explosive dynamics. By raising interest … rates in response to inflation, the Fed induces ever-larger inflation or deflation, unless inflation jumps to one particular … following policies we usually consider impossible. Therefore, inflation is just as indeterminate under "active" interest rate …

The new-Keynesian, Taylor-rule theory of inflation determination relies on explosive dynamics. By raising interest … rates in response to inflation, the Fed induces ever-larger inflation or deflation, unless inflation jumps to one particular … following policies we usually consider impossible. Therefore, inflation is just as indeterminate under "active" interest rate …

We argue that the Great Inflation experienced by both the United Kingdom and the United States in the 1970s has an … common doctrine underlying the systematic monetary policy choices in each country. The nonmonetary approach to inflation …