We argue that real uncertainty itself causes long-run nominal inflation. Consider an infinite horizon cash … the central bank fixes the nominal rate of interest. We show that the equilibrium long-run rate of inflation is strictly … an explicit formula for the long-run rate of inflation, based on the famous Fisher equation. The Fisher equation says the …

Empirical models of inflation often incorporate equilibrium correction effects based upon levels of prices and input … permanent shifts in the markup factor through estimating an inflation equation that includes a time-varying intercept. The model …

of the system to one comprising inflation and relative prices. This is then estimated in I(1) space. An impulse response … on domestic inflation is moderated. This explains why the depreciation of sterling in 1992 left inflation unchanged. In … contrast, high real import prices in 1974 increased inflation because wage accommodation effects were absent. …

Standard open economy models predict that openness to trade should exert a positive effect on the slope of the output-inflation …

inflation dynamics in open economies, but previous studies have not made a distinction between fixed and floating exchange rate … driving output and inflation (the underlying theory requires that monetary shocks dominate). We calculate new measures of the …

Recent decades have seen a considerable expansion of global trade and a simultaneous decline in inflation volatility …. This paper investigates whether greater openness to trade helps achieve inflation stability. Using panel data for a sample … effect of openness on inflation volatility. This relationship is estimated after controlling for the potential endogeneity of …

for consumption in each period before knowing their income, then there is no inflation. However, there is an inflationary … inflation. …

The classical Fisher equation asserts that in a nonstochastic economy, the inflation rate must equal the difference … inflation replaced by the harmonic mean of the growth rate of money. Except for logarithmic utility, we show that on almost … every path the long-run rate of inflation is strictly higher than it would be in the nonstochastic world obtained by …

We prove the existence of stationary monetary equilibrium with inflation in a “Bewley” model with constant aggregate …. We also find that, in the presence of real micro uncertainty about individual endowments, the rate of inflation is higher … are shown to generate additional inflation. …