UID:
almafu_9960119382402883
Format:
1 online resource (xiii, 202 pages) :
,
digital, PDF file(s).
Edition:
1st ed.
ISBN:
0-511-89590-9
Content:
This book surveys the imperfect-information approach to inflation and its real effects. Two types of informational limitation are considered. One involves situations in which individuals have asymmetric information about the current general price level and consequently confuse relative and aggregate changes in prices. The other considers situations in which individuals cannot distinguish permanent from transitory changes as soon as they occur, creating a temporary but persistent confusion between such changes. The author presents the arguments within the context of the recent re-evaluations by economists of previously established views concerning inflation and its interaction with real phenomena.
Note:
Title from publisher's bibliographic system (viewed on 05 Oct 2015).
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Cover -- Frontmatter -- Contents -- Preface -- A general overview -- 1 Introduction -- 2 Equilibrium versus disequilibrium views of the economy -- 3 Neutrality of money, the Phillips curve, and the aggregate-relative confusion -- 4 Confusion between permanent and transitory changes -- 5 Welfare costs of inflation -- 6 Guide to the topics and layout of the book -- Aggregate-relative confusion -- Asymmetric information in economics and the information conveyed by prices and other signals -- 1 Introduction -- 2 Asymmetric information and its transmission through signaling and screening -- 3 Asymmetric information and its transmission through market prices -- 4 Implications for the incentive to collect information and the limits of price information -- 5 Recent extensions: costly information with aggregation of information and conditioning on past prices -- Aggregate-relative confusion: implications for the Phillips curve -- 1 Phillips trade-off from Phillips to Lucas: overview -- 2 Lucas's (1973) model with full current information about the general price level -- 3 Reintroduction of the aggregate-relative confusion into Lucas's model: rational expectations and equilibrium -- 4 Implications for the short-run Phillips curve and empirical testing -- Appendix -- Aggregate-relative confusion: implications for the distribution of inflationary expectations and for inflation uncertainty -- 1 Introduction -- 2 Effect of monetary variability on the distribution of price level perceptions over markets -- 3 Monetary variability, the cross-sectional variance of inflationary expectations, and inflation variance -- 4 Inflation uncertainty, inflation variance, and the variance of inflationary expectations -- 5 Some empirical evidence -- 6 Concluding comments -- Appendix.
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Implications of inflation uncertainty and differential inflationary expectations for the bond market and its allocative efficiency -- 1 Introduction -- 2 Bond market equilibrium with heterogeneous expectations -- 3 Generalization of Fisher's theory of interest to the case of differential inflationary expectations -- 4 Effect of inflation uncertainty and heterogeneous expectations on the allocative efficiency of the bond market -- 5 Effect of differential expectations on the volume of trade in bonds -- 6 Effect of differential expectations on unexpected redistribution through the bond market -- Appendix -- Aggregate-relative confusion: implications for relative price variability -- 1 Introduction and some evidence -- 2 Relative price variability and the variability of inflation -- 3 Relative price variability and the cross-sectional variance of inflationary expectations -- 4 Relative price variability and inflation uncertainty -- 5 Effect of different supply elasticities on relative price variability -- 6 Effects of monetary variability on relative price variability when supply elasticities differ -- 7 Concluding comments and a review of other approaches -- Appendix -- Place of the aggregate-relative confusion within the economics of asymmetric information: some concluding reflections -- 1 Introduction -- 2 Aggregation of information by prices and the aggregate-relative confusion -- 3 Aggregate-relative confusion in the presence of a centralized bond market -- Permanent-transitory confusion -- Permanent-transitory confusion and other reasons for persistence: overview -- 1 Introduction -- 2 Costs of adjusting capital stocks and gestation lags -- 3 Consumption smoothing -- 4 Disutility from intense and sustained periods of work -- 5 Costs of adjusting labor inputs -- 6 Persistence and inventories -- 7 Staggered contracts and persistence.
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Permanent-transitory confusion: implications for stagflation and the persistence of unemployment -- 1 Introduction -- 2 Model -- 3 Formation of beliefs about permanent variables -- 4 Working of the model -- 5 Stagflation -- 6 Conclusion -- Permanent-transitory confusion: implications for monetary policy and the efficiency of the price system -- 1 Introduction -- 2 Model -- 3 Adaptive nature of relative price forecasts -- 4 Effects of erratic monetary policy and other uncertainties on the efficiency of relative prices as signals for production decisions -- 5 Additional aspect of the optimality of forecasts -- 6 Alternative measure for the efficiency of the price system and the effect of the production lag -- 7 Remark on generality -- Appendix -- Permanent-transitory confusion: implications for relative price variability and inflation -- 1 Introduction -- 2 Effect of the permanent-transitory confusion on relative price variability -- 3 General rate of inflation and its variance -- 4 Relative price change and its variance -- 5 Cross-sectional relationship between the variance of inflation and the variance of relative price change -- 6 Conjecture on the relationship between the rate of inflation and the variance of inflation -- Notes -- Glossary of symbols -- References -- Index.
,
English
Additional Edition:
ISBN 0-521-07084-8
Additional Edition:
ISBN 0-521-25630-5
Language:
English
URL:
Volltext
(lizenzpflichtig)
URL:
https://doi.org/10.1017/CBO9780511895906
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