We construct an empirical test of whether the anticipation of adoption of inflation targeting affects the inflation … rate. We observe that most of the central banks adopt the regime after first achieving significant disinflation. With pre-inflation …-in-difference framework. We find that inflation targeting is successful in locking-in already low inflation rather than reducing high …

persistent movements of aggregate inflation. Moreover, the impact of a monetary policy shock on unemployment and inflation … cycle model. In particular, we analyze the effect of a monetary policy shock and investigate how labor market frictions … employment and hours affecting inflation dynamics via marginal costs. We find that the response of unemployment and inflation to …

consumption via managing inflation expectations based on the Euler equation. Unconventional fiscal policy uses trivial … announcements of future consumer-price increases to boost inflation expectations and consumption expenditure on impact. Instead … inflation expectations and spending today. We find households' inflation expectations and readiness to spend react substantially …

zero lower bound may be binding even after the shock has abated. We characterize conditions when the commitment to hold …

We tackle two questions in this paper: In the sovereign debt crisis, what moves the euro area inflation outlook and has … the firm anchoring of medium to long-term inflation expectations been touched? Deriving densities from a new data set on … options on the euro area harmonized index of consumer prices provides us with the full distribution of inflation expectations …

policy analysis, researchers should use a menu cost model like ours or at least a third, theory-based shortcut: set the Calvo …