costs driven by changes in factor prices than to increases in marginal cost precipitated by expansions in output. We explore …

literature by considering a local approximation around a zero inflation steady state and introducing idiosyncratic shocks. The …

perspective on the linkages among monetary policy, inflation, and the business cycle. It is argued that the adoption of an …

Sticky-price models with rational expectations fail to capture the inertia in U.S. inflation. Models with backward …-looking expectations capture current inflation behavior, but are unlikely to fit other monetary regimes. This paper seeks to overcome these … problems with a near-rational model of expectations. In the model, agents make univariate forecasts of inflation: they use …

each country faces a short run tradeoff between output and inflation. The model is sufficiently tractable to solve … response to domestic inflation, under cooperation they should respond to foreign inflation as well. In either scenario …

shocks have their maximum impact on inflation with a substantial delay. Third, the change in inflation is positively …

This paper first outlines the key stylized facts about changes in inflation dynamics in recent years: 1) inflation … persistence has declined, 2) the Phillips curve has flattened, and 3) inflation has become less responsive to other shocks. These … changes in inflation dynamics are interpreted as resulting from an anchoring of inflation expectations as a result of better …

, consistent with the evidence, increases with inflation. Because we assume that firms sell multiple products and choose how many … inflation accelerator--a feedback loop between inflation and the fraction of price changes--which significantly increases the … slope of the Phillips curve during periods of high inflation. Applied to the U.S. time series, our model predicts that the …

The US and other advanced countries suffered bursts of severe inflation in 2021 and the first half of 2022, followed by … declines of inflation later in 2022, in some countries. In times of high volatility of price determinants--cost and … productivity--inflation can jump upward and fall downward at high speed, contrary to the uniformly sticky behavior associated with …

level and that prices are substantially less volatile than costs. We show that in the relative-deep-habits model of Ravn …, in response to a firm-specific increase in marginal costs, prices rise, but by less than marginal costs leading to a … decline in the firm-specific markup of prices over marginal costs. Pass-through is predicted to be even lower when shocks to …