This paper presents experimental evidence from a monetary sticky price economy in which output and inflation depend on … expected future inflation. With rational inflation expectations, the economy does not generate persistent deviations of output … and inflation in response to a monetary shock. In the experimental sessions, however, output and inflation display …

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 …

perceived inflation persistence by the private sector. Such a sophisticated policy reduces inflation persistence and inflation … volatility at little cost in terms of output gap volatility. Persistent responses to cost-push shocks and stability of inflation … play is very different. In the case of commitment it relies on expectations of future policy actions affecting inflation …

theory: (1) the extent of overestimation of inflation was strongly associated with subjective difficulty using the Euro; (2 …Following the Euro changeover in January 2002, consumers across the Euro Area perceived a sharp rise in inflation, in …) there was a simultaneous downward shift in expected inflation. Our results imply that currency changeovers are not simple …

A crucial but often ignored element of inflation expectations is the amount of perceived inflation risk. This paper …) using a new methodology. The main conclusion from our analysis is that, when monitoring inflation expectations, limiting … attention to a point prediction is not sufficient. The analysis of inflation expectations should take into account inflation …

Do survey data on inflation expectations contain useful information for estimating macroeconomic models? I address this … restriction and helps to determine the forecasting model for inflation that agents use under learning. My results reveal that the … inflation expectations. …

, we follow Roberts (1997) and Adam and Padula (2003) and use direct measures of inflation expectations. The data source is … the Ifo World Economic Survey, which quarterly polls economic experts about their expected future development of inflation … turns out to more relevant for most countries in our sample. (ii) The use of survey data for inflation expectations yields a …

This paper examines the long-run effects of supply shocks (such as oil shocks) on inflation in the United States. The … persistence of supply shocks in U.S. inflation fell considerably during the period of Volcker's disinflation (1979-1982). My … the behavior of inflation expectations-agents expected shocks to persist in the pre-Volcker period, but not in the post …