ERC Consolidator Grant · 2022
A Learning-from-Prices view of Inflation and Business Cycles
The Eurozone is currently facing a sudden and sharp increase in inflation. Whether inflationary pressures will persist and what will be the cost of an eventual monetary tightening crucially depends on inflation expectations. The aim of this project is to provide theoretical and empirical support to a new channel, through which inflation may persistently shift business activity. The project sheds new light on how market prices influence consumers’ perceived inflation and how this may allow for the transmission of monetary policy even in the absence of rigidities in firms’ pricing. It shifts the focus from a traditional firm-centric to a (complementary) household-centric view of money…
From the public funding record at EU CORDIS. Describes the funded project, not the reviews below.