Journal Article

How inflation hawks escape expectations traps

Abstract: Why did inflation increase so dramatically from the 1960s to the 1970s? One possible theory is that once people started believing inflation would rise, the Fed was forced to validate those expectations by increasing the money supply. In \\"How Inflation Hawks Escape Expectations Traps,\\" Sylvain Leduc discusses this \\"expectations trap\\" hypothesis and uses a direct measure of expectations to see if the theory is consistent with the data.

Keywords: Inflation (Finance);

Bibliographic Information

Provider: Federal Reserve Bank of Philadelphia

Part of Series: Business Review

Publication Date: 2003

Issue: Q1

Pages: 13-20