Inflation, Stagflation, Relative Prices, and Imperfect by Alex Cukierman

By Alex Cukierman

This booklet surveys the imperfect-information method of inflation and its genuine results. sorts of informational hindrance are thought of. One comprises events during which members have uneven information regarding the present basic expense point and hence confuse relative and combination alterations in costs. the opposite considers events within which participants can't distinguish everlasting from transitory alterations once they take place, making a transitority yet chronic confusion among such alterations. the writer provides the arguments in the context of the new re-evaluations through economists of formerly demonstrated perspectives referring to inflation and its interplay with actual phenomena.

Show description

Read Online or Download Inflation, Stagflation, Relative Prices, and Imperfect Information PDF

Best macroeconomics books

Modern Macroeconomics

Greater than a decade after the book of the significantly acclaimed a contemporary consultant to Macroeconomics, Brian Snowdon and Howard Vane have produced a precious successor within the type of smooth Macroeconomics. completely prolonged, revised and up to date, it's going to develop into the necessary textual content for college students and lecturers of macroeconomics within the new millennium.

Macroeconomics

Mankiw’s Macroeconomics has been the number 1 publication for the intermediate macro direction because the booklet of the 1st version. It continues that bestselling prestige via always bringing the vanguard of macroeconomics thought, study, and coverage to the study room, explaining complicated recommendations with remarkable readability.

Reformist Voices of Islam: Mediating Islam and Modernity

Lately, Islamic fundamentalist, innovative, and jihadist activities have overshadowed extra average and reformist voices and tendencies inside of Islam. This compelling quantity introduces the present new release of reformist thinkers and activists, the highbrow traditions they create on, and the explanations for the failure of reformist pursuits to maintain wide aid within the Islamic international this present day.

Unemployment Fluctuations and Stabilization Policies: A New Keynesian Perspective (Zeuthen Lectures)

The prior fifteen years have witnessed the increase of the hot Keynesian version as a framework of reference for the research of fluctuations and stabilization guidelines. That framework, which mixes the rigor and inner consistency of dynamic common equilibrium types with such quite often Keynesian assumptions as monopolistic festival and nominal rigidities, makes attainable a significant, welfare-based research of the results of financial coverage ideas.

Extra resources for Inflation, Stagflation, Relative Prices, and Imperfect Information

Sample text

Hence the incentive to spend resources to become informed increases when this var­ iance increases . When a futures market opens, two prices transmit information from the informed to the uninformed. One is, as before, the spot price of the Asymmetric information and prices 27 good; the other is the futures price. Together these two prices reveal all the privileged information of the informed (including total current out­ put and the conditional expected value of the next period's spot price given 8).

This notion is discussed more fully in Section 4. To maintain some incentive for becoming informed , Grossman intro­ duces an additional source of uncertainty in the form of a stochastic (for the uninformed) risk-aversion parameter for informed firms. As a result the price system no longer perfectly transmits the information of the in­ formed to the uninformed and the incentive to collect costly information is retained. Under these circumstances there are two motives for taking positions in the futures market.

At the other extreme when pj = 0, price does not reveal any information about () . Grossman and Stiglitz show that pj i s an increasing function of r and a decreasing function of the cost of becoming informed and of the risk­ aversion parameter of informed individuals . The first result just states that an increase in the quality of information of the informed also in­ creases the quality of information carried through price. Changes in all other exogenous parameters do not affect pj because they trigger two conflicting effects that cancel each other.

Download PDF sample

Rated 4.91 of 5 – based on 28 votes