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 … inflation there is a switch from a separating equilibrium to a pooling equilibrium, where financial institutions become unable …

question of what the welfare cost of inflation is (which depends on how the government uses the windfall gains from the … inflation tax). We find that cohort effects are quite important, accounting for half of the increase in money holdings with age … literature. The cost of inflation is lower by one-third in the model and, as a result, lower than previously estimated in the …

compute the welfare cost of inflation in the United States. In doing so, it circumvents the problem of data-mining of some …

, for example. I show that fixed periods underestimate the welfare cost of inflation. I use a model in which agents choose … inflation increases from 0.1 percent of income with fixed periods to 1 percent with optimal periods. The results are robust to …

inflation. A dynamic stochastic general equilibrium model with heterogeneous agents is studied. Incomplete markets induce agents … equilibria, I measure the welfare cost of inflation by explicitly modeling the transitional dynamics that arise following a … change in monetary policy. Transitional dynamics are shown to increase the welfare cost of inflation substantially. Also …

The literature on the welfare costs of inflation universally assumes that the many-person household can be treated as a … function and, therefore, the welfare costs of inflation. Second, more importantly, we derive sufficient conditions under which …-equilibrium measure of the welfare costs of inflation can be obtained as a first-order approximation of the general-equilibrium welfare …

Recent studies on shifting trend inflation use the Standard New Keynesian model with Calvo price settingto address … rigidities in goods and labor markets, trendgrowth, time-varying trend inflation, and production networking. We then investigate …) theinteraction between staggered wage contracts and both trend growth and production networking, whentrend inflation increases …