The correlation between persistent changes in the markup in one sector of an economy and the inflation rate is …. We find that the correlation is in general positive under an exogenous money growth rule as well as under an inflation … targeting rule. That is, a decrease of the markup leads to a decrease in the CPI-inflation rate. However, if inflation is …

stronger bargaining position when they try to prevent a cut in money wages. If inflation is so low that some money wages have … to be cut, workers stronger bargaining position requires higher unemployment in equilibrium. However, inflation is more … stable when money wage rigidity binds, providing an incentive for monetary policy makers to choose a low target for inflation …

good inflation. In addition, the Ramsey optimal monetary policy can be approximated reasonably well with a Taylor …-type interest rate rule with weights on both inflation rates and output. -- Inflation and Output Persistence ; Monetary Policy …

This paper studies monetary policy rules in a small open economy with Inflation Targeting, incomplete pass-through and …

output and inflation, as observed in a vectorautoregression analysis. In contrast to backward indexation to past inflation …, which is often assumed in the literature, sticky information leads to a hump-shaped response in the inflation of flexibly …