We discuss the timing and strength of the Fed's reaction to the recent inflation surge within an estimated … macroeconomic model where long-run inflation expectations are heterogeneous and can lose their anchoring to the target. The … resulting inflation scare worsens the real cost of disinflation. We derive a closed-form solution that retains the entire time …

This paper provides new evidence on a long-standing question asked by Shiller (1997): Why do we dislike inflation? I … inflation and their reactions to it. The predominant reason for people's aversion to inflation is the widespread belief that it …-income groups. Inflation also provokes stress, emotional responses, and a sense of inequity, as the wages of high-income individuals …

We identify many major U.S. corporations that are highly exposed to inflation risk. Yet, although the SEC legally … requires disclosing possible risk factors, more than 61% of the inflation-exposed corporations do not disclose inflation risk … factor texts, only inflation-exposed firms are more likely to begin disclosing inflation risk. Simulations using calibrated …

Empirical evidence suggests consumers rely on their shopping experiences to form beliefs about inflation. In other …. Learning by shopping anchors households' beliefs about inflation to its past, causing disagreement with firms over the value of … inflation, increases the degree of anchoring of households' inflation expectations, and flattens the slope of the Phillips curve …

Inflation expectations are key determinants of economic activity and are central to the current policy debate about … whether inflation expectations will remain anchored in the face of recent pandemic-related increases in inflation. This paper … inattention when inflation is low. This suggests that there is indeed a risk of an acceleration in the increases in inflation …

-expectations model to study the state-dependent risk of inflation expectations unanchoring in low- and high-inflation environments. In … our model, agents are either trend-chasing or mean-reverting forecasters of inflation. We interpret the degree of mean … reversion in inflation expectations as a measure of anchoring, which varies over time with the share of agents using each …

This paper proposes a solution to the post-crisis Eurozone "missing inflation" puzzle. I demonstrate that following an … initially subdued inflation, economic agents started to forecast inflation by extrapolating past inflation developments as … opposed to utilizing a purely forward-looking model. I show that such a shift aggravated the decline of actual inflation …

This paper documents a strong relationship between households’ perceptions about inflation over the past 12 months and … households’ short- and long-term expectations about future inflation. This relationship is strong during periods of high-inflation … but even stronger during low-inflation periods. We establish a causal relationship by implementing a randomized …

This paper documents a strong relationship between households' perceptions about inflation over the past 12 months and … households' short- and long-term expectations about future inflation. This relationship is strong during periods of high-inflation … but even stronger during low-inflation periods. We establish a causal relationship by implementing a randomized …

exploits the rounding patterns in individuals' responses to survey questions on inflation expectations (Binder, 2017). This … inflation expectations. …