This paper embeds survey price expectations of manufacturing into a mark-up model of price determination. The model, which is employed to forecast (changes in) growth in consumer and producer prices one quarter ahead, is estimated for seven EEC countries. The predictive performance, in terms of...

The Lucas supply curve is tested using EEC price expectational data. The tests failed to find any evidence of a positively sloped aggregate supply curve due to worker and producer misperception.

This paper suggests that dividends do not reflect permanent earnings of corporations in periods of high inflation and deflation, and therefore the price-dividend relationship, as predicted by Gordon’s dividend-price model, breaks down. Using data for the US and the UK over the period from 1871...

This paper argues that the adoption of an inflation target reduces the persistence of inflation.We develop the theoretical literature on inflation persistence by introducing a Taylor rule for monetary policy into a model of persistence and showing that inflation targets reduce inflation...