Why are we seeing inflation? The government dropped about $5 trillion in people's bank accounts, a classic fiscal … helicopter drop. Why did this one produce inflation? People do not believe this debt will be repaid. Will inflation continue …? Whether we see a one-time price-level increase or continued inflation depends on future fiscal and monetary policy, and …

paper, I assess the implications of the zero lower bound in a DSGE model with financial frictions. The analysis shows that … as the management of expectations by the central bank or a counter-cyclical fiscal stimulus, may help recover the economy …

rule (MT) that takes both debt and inflation into consideration exaggerates the trade-off between short-run and long …-run multipliers. In addition, we show that relative to seiniorage, inflation and changes in the discount factor play more important …

near-term economic outlook, characterised by persistently low nominal interest rates and inflation, and in a lasting low …

responsive to inflation. When monetary and fiscal policy regimes can switch, policy uncertainty also reduces spending multipliers …. In particular, when higher inflation induces a rising probability to switch to a regime in which monetary policy actively … controls inflation and fiscal policy raises future taxes to stabilize government debt, the multipliers can fall much below …

related to their inflation expectations. In a high-inflation regime, as in the early 1990s, consumers with higher inflation … work. Conversely, in a low-inflation environment, such as the one after the global financial crisis, higher expected … inflation lowers households' purchasing power and, thereby, spending (income effect). We also find that the composition of …

primary surpluses should lead households to anticipate this higher inflation. Are household inflation expectations sensitive … observing how they revise their expectations about future inflation as well as taxes and government spending. We find that … information about the current debt or deficit levels has little impact on inflation expectations but that news about future debt …