solutions such as the conservative central banker and optimal inflation contracts. Our theoretical model also shows how an … inflation targeting range should be set and how it should respond to changes in the nature of shocks to the economy …

inflation. Previous studies, which assume a constant degree of price rigidity across inflation regimes, find two time consistent … equilibria - one with low inflation, the other with high inflation. In contrast, when price rigidity is endogenous, the high … inflation equilibrium ceases to exist. Hence, time consistent equilibrium is unique. This result depends on two features of the …

countries that are heterogeneous with respect to their output shocks. Once an inflation rate of the common currency has been …. In our currency union model, the inflation rate of the common currency is determined by majority voting among N member … fixed social cost and individually chooses the inflation rate of its currency. Unlike previous research on this topic, we …

recurrently. The escape route dynamics cause recurrent outcomes close to the Ramsey (commitment) inflation rate in a model with an …

solutions such as the conservative central banker and optimal inflation contracts. Our theoretical model also shows how an … inflation targeting range should be set and how it should respond to changes in the nature of shocks to the economy …