bound is relatively low, especially if the inflation target established for the monetary authority is 2 per cent or more … rate for lower inflation targets. Various caveats apply to drawing conclusions for Canada from the papers we surveyed …

specification with a time-changing variance and menu-cost effects. The variance of the notional distribution fell as inflation … lifetime of contracts. On balance, the evidence suggests that the long-run trade-off between inflation and the unemployment … rate is close to vertical at inflation rates of 2 per cent or more if productivity growth is near the average in recent …