This paper investigates the performance of optimised interest rate rules when there is uncertainty about a key determinant of the monetary transmission mechanism, namely the degree of persistence characterising the inflation process. The paper focuses on the euro area and utilises two variants of...

This paper offers an alternative explanation for the behavior of postwar US inflation by measuring a novel source of monetary policy time-inconsistency due to Cukierman (2002). In the presence of asymmetric preferences, the monetary authorities end up generating a systematic inflation bias...

At the beginning of the 21st century, Europe and Latin America are still seeking the formula that would lend a strategic character to their relationship. Most recently, the Summit in Vienna in May 2006 failed to do so. Both partners reactivated their relations which had never been broken but...