reduced-form Phillips curve - the positive dependence of inflation on its own lags. In this paper, I show hat it is the 4 … price reset hazard function can generate simulated data that are consistent with inflation gap persistence found in US CPI … data. I conclude that a non-constant price reset hazard plays a crucial role for generating realistic inflation dynamics …

and services, although the differences are not dramatic. The size of price decreases plays a key role in inflation … and so cancel one another out. -- Price rigidity ; inflation …