Understanding inflation: lessons from the past, lessons for the future?

Thursday, 21 September 2017 to Friday, 22 September 2017
ECB, Frankfurt
European Central Bank

The aim of the conference, hosted by the European Central Bank (ECB) in Frankfurt am Main on 21-22 September 2017, is to enhance our understanding of the drivers and dynamics of inflation and of inflation expectations, to draw conclusions from the most recent low inflation environment as well as from earlier episodes, and to discuss lessons for the future.

The program will cover structural and reduced-form inflation modelling looking at, e.g.  inflation persistence, measurement of inflation, the use of micro price data and other big data, the Phillips Curve and the international dimension of inflation, structural determinants of inflation dynamics and trend inflation, exchange rate and oil price pass-through, determinants of inflation expectations, determinants of inflation differentials in a monetary union.

The conference will provide a forum for discussing innovative research and to facilitate exchanges of views between researchers and policymakers. 

May 31, 2017
Fri, 24/03/2017 - 3:49pm

Dear EABCN Conference Organizers, for the conference

“Understanding inflation: lessons from the past, lessons for the future?


21-22 September 2017, Frankfurt am Main



Please find attached our Abstract as part of our Submission for the September conference. The paper is by Szilard Benk, Director of Research at the Hungarian National Bank, and myself, Max Gillman.





“Granger Causality of Real Oil Prices after the Great Recession”,

By Szilard Benk and Max Gillman



Since 2005 real oil prices, in terms of the WTI divided by the CPI index, surged to a sustained level especially from 2009 until 2015, in a way comparable to the real oil price increase at the height of the second 1970's "oil shock" when the US inflation rate was at historically high levels. Including tests for structural breaks, this paper shows Granger causality of the monetary base to the real oil price, as related to the monetary findings of Alquist et al. (2013) and Gillman and Nakov (2009) that there exists Granger-causality of inflation and money for oil prices in data up to 2009. These reversals of Hamilton's (1983) results that no macroeconomic series Granger causes oil prices, are different in nature in the new results for the post- Great Recession period relative to these other monetary findings. In particular, now only the money supply growth Granger causes oil prices and inflation does not. This results as inflation expectations were built into real oil prices because of the unprecedented growth in the US monetary base, but then the inflation failed to materialize and the expectations of inflation collapsed along with the real oil price. This gives evidence of how monetary factors can be important in oil price forecasting, and how unexpected real distortions from monetary policy can result.



Max Gillman

Hayek Professor

Department of Economics

SSB 408

University of Missouri at St. Louis

1 University Blvd.

St. Louis, MO 63121


(314) 516- 5861

Fax Number
(314) 516-5352