there is a significant backward looking element in inflation behaviour. This cyclical instability can be mitigated if fiscal … policy in each member country reacts to inflation differences, but it can be aggravated if fiscal feedback on debt is too …

conditions and explore the possibility under which a policy tack that targets inflation stability, output stability, or both, can … efficient business cycle outcomes (inflation and output stability). We find that there is a range of inflation and output target … weights that simultaneously stabilize inflation and output. We call this condition, produced by these weights, inflation …

precisely, inflation, to support the first best allocation. In our model policy is non-Ricardian or equivalently outside money … positive inflation tax on money balances is efficient. For interest rates that permit the collateral constraint to bind, a … policy of stable inflation (alternatively, money growth) implies that the collateral constraint binds after a sequence of …

aggregate inflation and the higher-order moments of the distribution of relative price changes. Our empirical findings confirm … explanatory variable for the inflation rate. Further, the skewness measure also helps to explain shifts in the Phillips curve …

coordinated wage bargaining systems have a dampening impact on inflation volatility. …

. Adding inflation as a second variable, we uncover two states in which expected consumption growth is low, one with high and … one with negative expected inflation. Embedded in a general equilibrium asset pricing model with learning, these dynamics …

Empirical evidence suggests that considerable differentials in inflation rates exist across households. This paper … investigates how central banks should react to household inflation heterogeneity in a tractable New Keynesian model. We include two … households that differ in their consumer price inflation rates after adverse shocks. The central bank reacts to either an average …