How do Galí's inflation models apply to today's economy?
My work on inflation dynamics, particularly the New Keynesian Phillips curve and its extensions, remains highly relevant for understanding current inflationary pressures. The models highlight the role of inflation expectations, supply shocks, and the output gap in driving price changes. Analyzing how these factors interact, as illuminated by the structural framework, is essential for policymakers attempting to manage inflation in response to global economic shifts and policy interventions.
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