Bursian, Dirk; Faia, Ester - 2013 - This draft: February 2013
inflation expectations, which ultimately depend on agents' trust. We propose a model embedding trust cycles, as emerging from … sequential coordination games betwen atomistic agents and the policy maker, in a monetary model. Trust affects agents' stochastic … the monetary transmission mechanism. Using data from the Eurobarometer survey we analyze the link between trust on the one …