Optimal Price Indices for Targeting Inflation Under Incomplete Markets
---- Acknowledgements -----
We are grateful to Kaushik Basu, Gita Gopinath, Karel Mertens, Parul Sharma, Viktor Tsyrennikov and Magnus Saxegaard for helpful comments and discussions. We received helpful comments from seminar participants at Cornell University, the IMF and the Reserve Bank of India. This research was supported by a grant from the International Growth Centre's Macroeconomics Program. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.