RDP 2011-01: Estimating Inflation Expectations with a Limited Number of Inflation-indexed Bonds Equation

\begin{array}{l} χ_{k}^{0} = {\hat{x}}_{k}^{-} \\ χ_{k}^{i} = {\hat{x}}_{k}^{-} + {(h \sqrt{P_{x_{k}}^{-}})}_{i} & i = 1, \dots, L \\ χ_{k}^{i} = {\hat{x}}_{k}^{-} - {(h \sqrt{P_{x_{k}}^{-}})}_{i} & i = L + 1, \dots, 2 L \end{array}