This paper investigates the dynamic interaction between ination and stock returns in four ination targeting countries. We find that following the introduction of formal targets, ination persistence and the magnitude of volatility spillovers between ination and stock returns have been reduced.

We present new evidence showing that fiscal austerity strengthens support for redistribution, especially for the relatively well-off. Our theoretical model proposes two mechanisms to explain this heterogeneity in support for redistribution: ‘altruism’ and ‘appreciation’. We test our...