We consider a heterogenous expectations model where some agents are adaptive learners while others are rational. We consider three optimal monetary policy rules when the central bank either does not influence expectations or does influence expectations of learners or does influence expectations...

The New Keynesian model with rational expectations unrealistically predicts that unanticipated credible changes in the inflation target lead to an immediate jump in the inflation level while the output gap is unaffected. We set up a theoretical model where agents learn the behaviour of the...

The modelling of expectations and its degree of backward looking behaviour are issues of main concern in the inflation dynamics research agenda. One approach in the literature is to use expectations from surveys as an approximation to actual expectations. We estimate the Phillips curve allowing...

The sticky information setup assumes that information disseminates slowly throughout the population, inducing interesting dynamics in macroeconomic models. Carroll (2003) estimates an epidemiological model of expectations, providing a microfoundation for the sticky information model of Mankiw...