al-Nowaihi, Ali; Stracca, Livio - European Central Bank - 2002
postulates (i) period-by-period loss functions that are non-convex, I.e. displaying diminishing or non-increasing sensitivity to …This paper sets out to investigate the role of additive uncertainty under plausible non-standard central bank loss … functions over future inflation. Building on a substantial body of evidence in the economic psychology literature, this paper …