Within a unified framework, the author conducts an empirical investigation of dynamic interrelationships among inflation, inflation uncertainty, relative price dispersion, and output growth. Focusing on the Canadian industrial sector, the author finds weak evidence that inflation uncertainty rises with the level of inflation, with short-run inflation uncertainty minimized at a trend inflation r...

Increases in uncertainty have ambiguous effects on the rate of investment in complete contracts models. Consequently, in order to model the adverse effects of high inflation on capital accumulation, macro models overimpose a CIA constraint to buy capital goods. The fall in investment is thus due to an increase in the effective price of capital goods, and not due to inflation uncertainty. In inc...

In a simple dynamic macroeconomic model, it is shown that uncertainty about structural parameters does not necessarily lead to more cautious monetary policy, refining the accepted wisdom concerning the effects of parameter uncertainty on optimal policy. In particular, when there is uncertainty about the persistence of inflation, it may be optimal for the central bank to respond more aggressivel...

It is widely acknowledged that the Fed can control the average inflation rate over a period of time reasonably well. Because of this and the Federal Open Market Committee’s (FOMC’s) long-standing commitment to price stability, the author argues that the FOMC has an implicit long-run inflation objective (LIO)—lower and upper bounds to the long-run inflation rate. He shows that the statements mad...

in this study, the relationship between inflation and economic growth of iran is conciliated with a perspective on uncertainty of inflation. we use a generalized autoregressive conditional heteroskedasticity (garch) model that make possible this advantage that conditional variance of error term changes along the time, also, vector error correction model (vecm) is stable. for surveying the co-in...

Fan chart or Monte Carlo simulations for assessing the uncertainty of inflation forecasts in Romania? Mihaela Simionescu To cite this article: Mihaela Simionescu (2014) Fan chart or Monte Carlo simulations for assessing the uncertainty of inflation forecasts in Romania?, Economic Research-Ekonomska Istraživanja, 27:1, 629-644, DOI: 10.1080/1331677X.2014.970453 To link to this article: http://dx...