separate inclusion of a labor market in the model helps to anchor inflation even in a situation of adaptive expectations, a … positive output gap and inflation above target. The estimation results show that the adaptive learning model does a better job … and inflation far above the central bank target. …

We evaluate the performance of inflation forecasts based on the open-economy Phillips curve by exploiting the spatial … pattern of international propagation of inflation. We model these spatial linkages using global inflation and either domestic … spatial interactions yields significantly more accurate forecasts of local inflation in 14 advanced countries (including the U …