Under conventional inflation targeting (IT), the lower bound on nominal interest rates gives
rise to a systematic downward bias in inflation that substantially reduces welfare. Using two …

We confront the notion that flexible rates insulate a country from external disturbances with
new evidence on spillovers from euro-area shocks to neighboring countries. We find that in …

Governments around the world embarked on a large fiscal expansion in response to the
GFC and COVID-19 crises, increasing government debt to levels not seen in 75 years. We …

European macroeconomies remain under-researched. There are compelling reasons for
this to change. European issues pose significant economic challenges, are theoretically …

US households' housing price expectations deviate systematically from full-information
rational expectations:(i) expectations are updated on average too sluggishly,(ii) expectations …

I propose an approach to quantify attention to inflation and show that attention declined after
the Great Inflation period. This decline in attention has important implications for monetary …

This paper considers average inflation targeting (AIT) policy in a New Keynesian model with
adaptive learning agents. There are stability concerns regarding AIT when agents have …

We study the implications of the Fed's new policy framework of average inflation targeting
(AIT) and its ambiguous communication. The central bank has the incentive to deviate from …

This paper studies a New Keynesian model of a two-country world with a zero lower bound
(ZLB) constraint for nominal interest rates. A floating exchange rate regime is assumed. The …

The difference between the implicit nominal interest rate and the growth rate of nominal GDP
is a key determinant of the dynamics and the sustainability of public debt. This paper studies …