We analyze the dynamics of inflation in an economy characterized by a forward-looking, staggered, price and wage … determination process, and by monetary accommodation. In our model, inflation reconciles the conflicting claims of workers and firms …. The model is capable of generating a positive association between real wages and inflation, of the type that has been …

uncertainty about the composition or timing of a stabilization. Under full certainty, inflation may rise, fall, or remain constant … there is no simple correlation between changes in the budget deficit and inflation. With uncertainty about the timing OF a … stabilization, the inflation rate will most likely exhibit fluctuations and may overshoot its steady state value, even when real …