The Dynamics of US Inflation: Can Monetary Policy Explain the Changes?

Abstract

We investigate the relationship between monetary policy and inflation dynamics in the US using a medium scale structural model. The specification is estimated with Bayesian techniques and fits the data reasonably well. Policy shocks account for a part of the decline in inflation volatility

Published as: The Dynamics of Us Inflation: Can Monetary Policy Explain the Changes? in Journal of Econometrics , Vol. 167, No. 1, 47--60, January, 2012