RDP 9803: Forward-Looking Behaviour and Credibility: Some Evidence and Implications for Policy
Equation (B3.4)
Δ
p
t
=
0.25
[
−
p
t
−
1
+
0.7
u
l
c
t
−
1
+
0.3
i
p
t
−
1
]
+
0.1875
Σ
i
=
1
4
Δ
p
t
−
i
+
0.07
4
g
a
p
t
−
1
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