This paper investigates the macroeconomic risks associated with undesirably low inflation using a medium-sized New … Keynesian model. We consider different causes of persistently low inflation, including a downward shift in long-run inflation … persistently low inflation depend crucially on its underlying cause, as well as on the extent to which monetary policy is …

macroeconomic series (inflation, output, hours, interest rates, and wages), and which can be used to inform applied monetary policy …

I revisit the General Theory's discussion of the role of wages in employment determination through the lens of the New …