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looking pricing account for the observed persistence in aggregate inflation. Second, price-setting responds to movements in … marginal costs, which should therefore be the driving force to observed inflation dynamics. This is not always the case in …) inflation, and underestimating the importance of (aggregate) marginal costs for (aggregate) inflation. We provide intuition for …
Persistent link: https://www.econbiz.de/10005662190
situation poses to price stability. We propose to regard the central banker as a risk manager who aims to contain inflation …
Persistent link: https://www.econbiz.de/10005123620
Following the Asian financial crisis in 1997-98, a number of Asian central banks adopted inflation targeting. We … explore how successful this framework has been by looking at the persistence of inflation, as measured by the sum of the … coefficients in an autoregressive model for inflation, using a median unbiased estimator and bootstrapped confidence bands. We find …
Persistent link: https://www.econbiz.de/10008684680
We estimate the approximate nonlinear solution of a small DSGE model on euro area data, using the conditional particle filter to compute the model likelihood. Our results are consistent with previous findings, based on simulated data, suggesting that this approach delivers sharper inference...
Persistent link: https://www.econbiz.de/10005067383
private sector inflation forecasts. But beyond the optimum people might: (1) start to attach too much weight to the … deteriorates the (perceived) quality of private sector inflation forecasts. Inflation then is set in a more backward looking manner … resulting in higher inflation persistence. By using a panel data set on the transparency of 100 central banks we find empirical …
Persistent link: https://www.econbiz.de/10005662239
policy shocks on aggregate consumption and for the impact on inflation that other models have hard a time explaining. In … particular, the model can account both for the price puzzle and for inflation persistence. We also show that the deep habits …
Persistent link: https://www.econbiz.de/10005791798
alternative monetary policy strategies. We start with the relationship between output and inflation and investigate the fit of the … reject the nominal contracting model in favor of the relative contracting model which induces more inflation persistence, we … in countries which transitioned out of a high inflation regime such as France and Italy. We close the model by estimating …
Persistent link: https://www.econbiz.de/10005791867
Inflation is a far from homogeneous phenomenon, a fact often neglected in modelling consumer price inflation. This … study, the first of its kind for an emerging market country, investigates gains to inflation forecast accuracy by …
Persistent link: https://www.econbiz.de/10008553067
Inflation targeting central banks will be hampered without good models to assist them to be forward-looking. Many … current inflation models fail to forecast turning points adequately, because they miss key underlying long-run influences. The … world is on the cusp of a dramatic turning point in inflation. If inflation falls rapidly, such models can underestimate the …
Persistent link: https://www.econbiz.de/10005123809
Models for the twelve-month-ahead US rate of inflation, measured by the chain weighted consumer expenditure deflator … prices; introducing non-linearities to proxy state dependence in the inflation process; and replacing the information …
Persistent link: https://www.econbiz.de/10008468684