Inflation equals the product of two terms: an extensive margin (the fraction of items with price changes) and an … intensive margin (the average size of those price changes). The variance of inflation over time can be decomposed into … intensive margin is the sole source of inflation changes in staggered time-dependent pricing models. We use micro data collected …

for the persistence and volatility of "reset price inflation." Reset price inflation is the rate of change of all desired … construct an empirical measure of reset price inflation. We find that time-dependent models imply unrealistically high … persistence and stability of reset price inflation. This discrepancy is exacerbated by adding strategic complementarities, even …

This paper analyzes the long-run determinants of inflation differentials in a monetary union. First, we aim at …some stylized facts relating the regional dispersion in headline inflation rates in the euro area as well as in the …-traded sector as the primary cause of price and inflation differentials, with shocks to productivity in the traded sector being …

impact inflation, little crowding out of private expenditure exists, and the multiplier tends to be larger compared to a one …

adjustment. As a result, the response of inflation to nominal shocks is both sluggish and hump-shaped. The model can also … qualitatively capture a number of stylized facts about price setting at the micro level and inflation at the macro level …

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 …

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