This study revisits and tests empirically the Portfolio Theory of Inflation (PTI), which analyzes how the effectiveness … (Bossone, The portfolio theory of inflation and policy (in)effectiveness, 2019). The PTI shows that when an economy is heavily … and policies aimed to stimulate output growth dissipate into domestic currency depreciation and higher inflation, with …

Households' and firms' subjective inflation expectations play a central role in macroeconomic and intertemporal … microeconomic models. We discuss how subjective inflation expectations are measured, the patterns they display, their determinants …

recession of 2008-2009, to think about whether the US is headed for a fiscal inflation, and what that inflation will look like …. I emphasize that a fiscal inflation can come well before large deficits or monetization are realized, and is likely to …

accumulated debt, but surpluses do not respond to arbitrary unexpected inflation and deflation, so fiscal policy remains active …

thereby affect inflation, with no change in fiscal surpluses. The same basic mechanism describes interest rate targets … frictions. In the presence of long-term debt, higher interest rates lead to temporarily lower inflation, a challenging sign. I …

determine inflation in this regime, so I base the analysis on the fiscal theory of the price level. I find that monetary policy … can peg the nominal rate, and determine expected inflation. With sticky prices, monetary policy can also affect real … interest rates and output, though higher interest rates raise output and then inflation. The conventional sign requires a …

targeted-inflation regime and a deflation regime and fit it to data from the U.S. and Japan. For the U.S. we find that adverse … central bank to keep rates near the ZLB doubles the fiscal multipliers in the targeted-inflation regime (U.S.), it has no …

welfare when alternative instruments are unavailable. Higher in inflation targets instead allow for negative real interest …

that a central bank may not have the power to determine the long-run rate of inflation without fiscal support. In a policy … regime where the fiscal authority is non-Ricardian, an attempt on the part of the central bank to lower inflation may end up … explain how low inflation, low interest rates, and high primary budget deficits can coexist. I also use the model to explain …