We develop an experimental framework to investigate the quantity theory of money and the real effects of inflation in … an economy where money serves as a medium of exchange. We test the classical view that inflation reduces output and … welfare by taxing monetary exchange. Inflation is engineered by constant money growth. We conduct three treatments, where the …

We use a representative online survey to investigate the inflation expectations of German consumers and the credibility … of the ECB's inflation target during the recent high inflation period. We find that credibility has trended downwards … since summer 2021, reaching an all-time low in April 2022. The high correlation between inflation expectations and the …

The rise in inflation in 2021-22 sparked a growing literature and debate over the causes of the surge as well as the … near- and medium-term path for inflation. This review offers three key messages. First, the exceptional nature of shocks … resulting from the COVID-19 pandemic and geopolitical events drove the surge in inflation and the initial underestimation by …

. inflation anchoring properties. This layout is then confronted with the policy framework in use in the euro area prior to the … dis-anchoring of long-term inflation expectations experienced in the euro area since 2013, however, suggests that the … policy framework could benefit from a rebalancing towards a formulation with stronger anchoring properties. The inflation aim …

We propose a new approach to assessing the anchoring of inflation expectations using "strategic surveys". Namely, we … measure households' revisions in long-run inflation expectations after they are presented with different economic scenarios. A … key advantage of this approach is that it provides a causal interpretation in terms of how inflation events affect long …

This paper analyzes the time-varying credibility of the Fed's inflation target in an empirical macro model with … asymmetric information, where the public has to learn about the actual inflation target from the Fed's interest rate policy. To …-term inflation expectations of professionals with the perceived inflation target. …

We provide evidence on the reactions of the level and probability distribution of households’ expectations of inflation … in the euro area to the ECB’s monetary strategy change to a symmetric inflation target in July 2021, and to the … subsequent strong rise in euro area inflation above target. We use a randomised control trial within a monthly representative …

We study the effects of forward looking communication in an environment of rising inflation rates on German consumers …' inflation expectations using a randomized control trial. We show that information about rising inflation increases short- and … long-term inflation expectations. This initial increase in expectations can be mitigated using forward looking information …