Abstract

RUDD, Jeremy B.. Why do we think that inflation expectations matter for inflation? (and should we?). Rev.econ.inst. [online]. 2022, vol.24, n.47, pp.213-243.  Epub Jan 20, 2023. ISSN 0124-5996.  https://doi.org/10.18601/01245996.v24n47.10.

Economists and economic policymakers believe that households' and firms' expectations of future inflation are a key determinant of real inflation. A review of the relevant theoretical and empirical literature suggests that this belief rests on unsound foundations and leads to the argument that adhering to it uncritically could easily result in serious policy errors.

Keywords : monetary policy; inflation; expectations; Phillips; curve; unemployment; wages; JEL: E24; E31 E52; E58.

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