In this paper we systematically evaluate how central banks respond to deviations from the inflation target. We present … a stylized New Keynesian model in which agents' inflation expectations are sensitive to deviations from the inflation … inflation exceeded the target in the past. Moreover, the central bank responds non-linearly to past inflation gaps. This is …

In this paper we systematically evaluate how central banks respond to inflation deviations from target. We present a … stylized New Keynesian model in which agents' inflation expectations are sensitive to inflation deviations from target. To (re …-)establish credibility, optimal monetary policy under discretion is shown to set higher interest rates today if average inflation exceeded …

In this paper we systematically evaluate how central banks respond to inflation deviations from target. We present a … stylized New Keynesian model in which agents' inflation expectations are sensitive to inflation deviations from target. To (re …-)establish credibility, optimal monetary policy under discretion is shown to set higher interest rates today if average inflation exceeded …

In this paper we systematically evaluate how central banks respond to deviations from the inflation target. We present … a stylized New Keynesian model in which agents' inflation expectations are sensitive to deviations from the inflation … inflation exceeded the target in the past. Moreover, the central bank responds non-linearly to past inflation gaps. This is …

In this paper we systematically evaluate how central banks respond to deviations from the inflation target. We present … a stylized New Keynesian model in which agents' inflation expectations are sensitive to deviations from the inflation … inflation exceeded the target in the past. Moreover, the central bank responds non-linearly to past inflation gaps. This is …

the Taylor rule is beneficial if the central bank aims at optimally stabilizing inflation and output gap variability under … discretion. Placing a weight on deviations from a simple Taylor rule increases the overall relative weight of inflation …

the Taylor rule is beneficial if the central bank aims at optimally stabilizing inflation and output gap variability under … discretion. Placing a weight on deviations from a simple Taylor rule increases the overall relative weight of inflation …

We examine both the degree and the structural stability of inflation persistence at different quantiles of the … conditional inflation distribution. Previous research focused exclusively on persistence at the conditional mean of the inflation … higher inflation persistence at the upper than at the lower tail of the conditional inflation distribution. Based on post …

We examine both the degree and the structural stability of inflation persis tence at different quantiles of the … conditional inflation distribution. Previous research focused exclusively on persistence at the conditional mean of the inflation … higher inflation persistence at the upper than at the lower tail of the conditional inflation distribution. Based on post …