policy. First, I consider whether ignoring money means returning to the conceptual framework that allowed the high inflation … of the 1970s. Second, I consider whether models of inflation determination with no role for money are incomplete, or … evidence for a long-run relationship between money growth and inflation. (Here I give particular attention to the implications …

to be important for optimal policy, that the optimal long-run inflation target is unaffected by the degree of potential …

of inflation and a suitably defined output gap, but that a concern for robustness requires greater resistance to surprise … increases in inflation than would be considered optimal if one could count on the private sector to have "rational expectations". …

function that penalizes inflation variations, deviations of output from potential, and interest-rate variability. Sluggish …

rational private sector expectations about housing prices and inflation, optimal monetary policy can be characterized by a … standard 'target criterion' that refers to inflation and the output gap, without making reference to housing prices. When the … increases (decreases), policy should adopt a stance that is projected to undershoot (overshoot) its normal targets for inflation …

to be important for optimal policy, that the optimal long-run inflation target is unaffected by the degree of potential …

even make possible complete stabilization of both aggregate output and inflation under certain circumstances, despite the …