, and the exchange rate is priced by uncovered interest parity, the real exchange rate is determined by expected inflation …-squares learning path for the real exchange rate implied by inflation and output gap data exhibits the real depreciation of the 70s …

perform poorly when knowledge is imperfect. In particular, policies that fail to maintain tight control over inflation are … prone to episodes in which the public's expectations of inflation become uncoupled from the policy objective and stagflation … effective communication of a central bank's inflation objective and of continued vigilance against inflation in anchoring …

Inflation targeting offers the promise of introducing to monetary policy a logic and consistency that some central …, inflation targeting also serves two further objectives that are of more questionable import, and while seemingly contradictory … vocabulary pertaining solely to inflation, inflation targeting fosters over time the atrophication of concerns for real outcomes …

. Key to our estimation strategy is the use of survey-based expectations for inflation and output. We identify accommodating … shocks shift to the low volatility regime around 1985 whereas inflation shocks do so only around 1990, suggesting active … monetary policy may have played role in anchoring inflation expectations. Shocks and policy regimes jointly drive the …

What monetary policy framework, if adopted by the Federal Reserve, would have avoided the Great Inflation of the 1960s … policy strategies. We show that policies constructed using modern optimal control techniques aimed at stabilizing inflation … stabilizing economic activity, an optimal control approach would have failed to keep inflation expectations well anchored …

control inflation and influence the economy in the usual ways. The paper discusses models of fiscal limits and their …

output response vanished, and the inflation response path became more gradual but larger in long-run magnitude. These … response coefficient estimates are robust to measurement and theoretical issues with both potential output and the inflation …

We develop and estimate a general equilibrium model in which monetary policy can deviate from active inflation …