. Whereas our methodology is general, we focus on an extended macro-model with unobservable processes for the inflation target … inflation target dominates the variation in the 'level factor' whereas monetary policy shocks dominate the variation in the …

We develop and estimate a structural model of inflation that allows for a fraction of firms that use a backward looking … measures of marginal cost as the relevant determinant of inflation, as the theory suggests, instead of an ad-hoc output gap …. Real marginal costs are a significant and quantitatively important determinant of inflation. Backward looking price setting …

This paper estimates the NAIRU (standing for the Non-Accelerating Inflation Rate of Unemployment) as a parameter that … varies over time. The NAIRU is the unemployment rate that is consistent with a constant rate of inflation. Its value is … determined in an econometric model in which the inflation rate depends on its own past values (‘inertia’), demand shocks proxied …

This paper models Chinese inflation using an output gap Phillips curve. Inflation modelling for the world’s sixth … curve for China and show that the output gap, the exchange rate, and inflation expectations play important roles in … explaining inflation. We adjust for structural change in the economy where possible and estimate regressions for rolling sample …

-neutrality; leads to a strong positive correlation between inflation and output; and contributes significantly to output volatility. We … find, however, that this increased volatility arises mostly at the higher than business cycle frequencies; leads to lower …, but especially over the business cycle. As noted by Chari, Kehoe and McGratten (1996) this failure of exogenous price …

The Calvo contract Phillips Curve is widely indexed for general inflation, using either core inflation or other … that optimal indexation would by contrast use the rational expectation of inflation. If this scheme is implemented, the …

We study optimal price setting by a monopolist in an infinite horizon model with stochastic costs, moderate inflation … steady state short-run Phillips curve implies that the output loss associated with a small negative inflation surprise is … about twice as large as the output gain associated with a small positive inflation surprise. …

-term inflation is derived from the dynamic stochastic general equilibrium (DSGE) model with state-dependent pricing developed by …-type price-setting as a special case. It describes current inflation as a function of lagged inflation, expected future inflation … find that current inflation depends positively on its own lagged values giving rise to intrinsic persistence as a source of …

Modern neo-Keynesian, new classical, and real business cycle models typically differ in the degree to which they …-neutrality of money and the `Fisher effect' of inflation on interest rates. …