This paper studies the optimal long-run inflation rate in a simple New Keynesian model with occasionally binding … inflation rate is around 1.5% if the economy is hit by a total factor productivity (TFP) shock and nearly 2.5% if the economy is … asymmetric endogenous cost-push shock is positive, inflation is also positive on average. In addition, a binding collateral …

solutions, all have failed as these attempts implicitly assume perfectly-correct inflation statistics. Examining these … assumptions, we discover that not only are the inflation numbers materially flawed, but more so, there are significant incentives … for government entities to under-report inflation. With this, we find that to explain the Equity Premium Puzzle, inflation …

Using daily data stemming from inflation-indexed markets, we analyse the effects of numerous macroeconomic surprises on … inflation compensation data - the sum of inflation expectations, risk and liquidity premia - in the euro area between 2 January … 2004 and 31 December 2007. Our results suggest that when gauging short and medium-term inflation compensations, market …

We assess the effects of financial shocks on inflation, and to what extent financial shocks can account for the … shocks through sign restrictions. Our main finding is that expansionary financial shocks temporarily lower inflation. This … during the crisis. We then explore the transmission channels of financial shocks relevant for inflation, and find that the …

We assess the effects of financial shocks on inflation, and to what extent financial shocks can account for the … shocks through sign restrictions. Our main finding is that expansionary financial shocks temporarily lower inflation. This … during the latest financial crisis. We then explore the transmission channels of financial shocks relevant for inflation, and …