The concept of causality introduced by Wiener (1956) and Granger (1969) is defined in terms of predictability one period ahead. This concept can be generalized by considering causality at a given horizon h, and causality up to any given horizon h [Dufour and Renault (1998)]. This generalization...

This paper develops a model with endogenous financial adaptation. With a representative agent, inflation and welfare increase upon introduction of financial adaptation. Once we allow for agents' heterogeneity, we can show that inflation still increases and that the "poor" are hurt, while the...

We construct a simple model in which high inflation imposes welfare costs because it affects the ability of the financial sector to screen between high and low cost producers. Consumers search for a low price and inflation reduces the incentives to search, resulting in an increase in the demand...

This paper develops a model with endogenous financial adaptation. With a representative agent, inflation and welfare increase upon introduction of financial adaptation. Once we allow for agents' heterogeneity, we can show that inflation still increases and that the "poor" are hurt, while the...

We construct a simple model in which high inflation imposes welfare costs because it affects the ability of the financial sector to screen between high and low cost producers. Consumers search for a low price and inflation reduces the incentives to search, resulting in an increase in the demand...