A game theory model of inflation. The impact of investor expectations on the actual level of inflation

Inflation is one of the most interesting phenomena in economics. Many models have already been models have already been developed that attempt to capture and explain it. Unfortunately, there are many factors shaping inflation has a very large number of complex phenomena. In addition, the dynamics of these changes make analysis even more difficult. Our research, the results of which are presented in this paper, was inspired by the desire to capture the impact of individual investors’ investment decisions on the inflation rate. The second important issue we dealt with The second important issue we address is the impact of inflation expectations on the decisions of these investors. on the decisions of these investors. These two relationships (the impact of expectations on decisions and decisions on inflation) are very closely linked. It is therefore advisable to consider them together.
The tool for our analysis will be a theoretical model of the money market, which we will build ourselves. Involving game theory in the modelling of the phenomenon will allow us to better understand the interactions between the various participants in the investment market.