Related papers: Functional Equation of the Rate of Inflation

This article is an extension of the work of one of us (Coopersmith, 2011) in deriving the relationship between certain interest rates and the inflation rate of a two component economic system. We use the well-known Fisher relation between…

We propose a new model for the joint evolution of the European inflation rate, the European Central Bank official interest rate and the short-term interest rate, in a stochastic, continuous time setting. We derive the valuation equation for…

A relation between interest rates and inflation is presented using a two component economic model and a simple general principle. Preliminary results indicate a remarkable similarity to classical economic theories, in particular that of…

Eternal inflation, the idea that there is always a part of the universe that is expanding exponentially, is a frequent feature of inflationary models. It has been argued that eternal inflation requires the violation of energy conditions,…

Given a system of analytic functions and an approximate zero, we introduce inflation to transform this system into one with a regular quadratic zero. This leads to a method for isolating a cluster of zeros of the given system.

We consider an inflationary scenario where the rate of inflaton roll defined by $\ddot\phi/H\dot \phi$ remains constant. The rate of roll is small for slow-roll inflation, while a generic rate of roll leads to the interesting case of…

We develop a model to price inflation and interest rates derivatives using continuous-time dynamics that have some links with macroeconomic monetary DSGE models equipped with a Taylor rule: in particular, the reaction function of the…

We propose a model for the joint evolution of European inflation, the European Central Bank official interest rate and the short-term interest rate, in a stochastic, continuous time setting. We derive the valuation equation for a contingent…

Monetary inflation is a sustained increase in the money supply than can result in price inflation, which is a rise in the general level of prices of goods and services. The objectives of this paper were to develop economic models to (1)…

The money supply is endogenous if the monetary policy strategy is the so called Inflation and Interest Rate Targeting, IRT. With that and perfect credibility, the theory of the price level and inflation only needs the Fisher equation, but…

We propose a class of discrete-time stochastic models for the pricing of inflation-linked assets. The paper begins with an axiomatic scheme for asset pricing and interest rate theory in a discrete-time setting. The first axiom introduces a…

We note that the essential idea of inflation, that the universe underwent a brief period of accelerated expansion followed by a long period of decelerated expansion, can be encapsulated in a "closure condition" which relates the amount of…

In this survey paper we discuss recent advances on short interest rate models which can be formulated in terms of a stochastic differential equation for the instantaneous interest rate (also called short rate) or a system of such equations…

We develop an axiomatic theory of balance functions (future value functions) in the theory of interest that is derived from financial considerations and which applies to general regulated payment streams, including continuous payment…

We analyze the flow into inflation for generic "single-clock" systems, by combining an effective field theory approach with a dynamical-systems analysis. In this approach, we construct an expansion for the potential-like term in the…

The standard calculation of the spectrum of density perturbations produced during inflation assumes that there is only one real dynamical degree of freedom during inflation. However, there is no reason to believe that this is actually the…

The meaning of the inflationary slow-roll approximation is formalised. Comparisons are made between an approach based on the Hamilton-Jacobi equations, governing the evolution of the Hubble parameter, and the usual scenario based on the…

We study constant roll inflation systematically. This is a regime, in which the slow roll approximation can be violated. It has long been thought that this approximation is necessary for agreement with observations. However, recently it was…

The paper tests the validity of the critique of the fiscal theory of the price level. A stochastic general equilibrium model with continuous time is constructed. An active fiscal policy and a passive monetary policy have been set. Monetary…

The spectrum of primordial fluctuations from inflation can be obtained using a mathematically controlled, and systematically extendable, uniform approximation. Closed-form expressions for power spectra and spectral indices may be found…