Andrade, Philippe; Galí, Jordi; Le Bihan, Hervé; … - 2019 - This version: October 2019
target, but the resulting higher steadystate inflation has a welfare cost in and of itself. We use an estimated DSGE model to …-state real interest rate, in the currently empirically relevant region the slope of the relation is found to be close to -1. That … slope is robust to allowing for parameter uncertainty. Under "make-up" strategies such as price level targeting, the …