This paper shows that it is possible to analyze equilibrium inflation determination without any reference to either … become negligible. Inflation in the cashless limit is shown to be a function of the gap between the natural rate' of interest …-rate rule indicating the tightness of monetary policy. Inflation can be completely stabilized, in principle, by adjusting the …

Proposals for 'inflation targeting' as a strategy for monetary policy leave open the important operational question of … how to determine whether current policies are consistent with the long-run inflation target. An interesting possibility is … that the central bank might target current private-sector forecasts of inflation, either those made explicitly by …

A relation between inflation and the path of average marginal cost (often measured by unit labor cost) implied by the … is shown to again take the standard "new-Keynesian" form, but with an elasticity of inflation with respect to real …

monopolistically competitive pricing, higher-order expectations are crucial for aggregate inflation dynamics, as argued by Phelps (1983 … disturbance, and a delayed effect on inflation, as found in VAR studies …

optimizing models with nominal price rigidities. Inflation stabilization enhances welfare, insofar as variable inflation results … sense in which inflation variability matters for welfare, however, depends upon the details of price-setting behavior …