Gerlach, Stefan; Svensson, Lars E. O. - 2021
power for future inflation. The real money gap contains more information about future inflation than the output gap and the …This paper studies the relationship between inflation, output, money and interest rates in the euro area, using data … spanning 1980 2000. The P* model is shown to have considerable empirical support. Thus, the price gap' or, equivalently, the …