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In ordinary language, inflation is an increase of prices measured in the unit of account.
Since modern inflation depends crucially on government policy, it is quite plausible that it can have a social explanation, and thus some of Fischer's ideas may have purchase here.
6) As in Barro (1986), the public's inflation expectations depend on their beliefs about how strongly policymakers dislike inflation.
When the shock occurs, maintaining low inflation requires anti-accommodative monetary policy, and hence higher unemployment.
A commitment by the Congress and the Federal Reserve would enhance credibility and convince economic agents to begin to base decisions on gradual elimination of inflation over a five-year period.
One of the worst things we could do is to eliminate inflation for a while and then return to high inflation later.
But policymakers may not have the luxury of waiting to see if a change in the inflation process is statistically significant before reacting.
If we can't accurately measure the output gap, we can't ascertain the impact of the gap on inflation or know whether it's declining.
While the recent decline in core goods inflation is similar to what occurred in 2010, a look at the components reveals notable discrepancies.
In this article, I evaluate how well a structural NKPC can account for the changing nature of inflation in the United States from the 1950s to today.
But there is something peculiar about the effect of inflation on the financial sector: It appears to have important thresholds.
After adopting transitional measures intended to lower inflation expectations gradually, four of the eight central banks define a term over which the inflation target is to be met.