Is inflation targeting operative in an open economy setting?
نویسندگان
چکیده
منابع مشابه
Is inflation targeting operative in an open economy setting?
The justification for inflation targeting rests on three core propositions. The first is called ‘lean against the wind’, which refers to fact that the monetary authority contracts (expands) aggregate demand below capacity when the actual rate of inflation is above (below) target. The second is ‘the divine coincidence’, which means that stabilizing the rate of inflation around its target is tant...
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We would like to thank Philip Lowe, Lars Svensson and David Gruen for helpful suggestions. We are extremely grateful to Luci Ellis for training us in the use of Mathematica 3.0. Any remaining errors are ours. The views expressed are those of the authors and should not be attributed to the Reserve Bank of Australia.
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This paper compares two types of monetary policy: price-level targeting and inflation targeting. It reviews recent arguments that favour price-level targeting, and examines how certain factors, such as the nature of the shocks affecting the economy and the degree to which agents are forwardlooking, bear upon the arguments. The paper then extends the analysis to a small open economy such as Cana...
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We would like to thank Adam Cagliarini and Ben McLean for superb research assistance, and participants at the conference for their comments. The views expressed in this paper are those of the authors and not necessarily those of the Reserve Bank of Australia.
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This paper considers a small open economy where government pursues debt targeting policy. In this setting, I find the optimal debt targeting rule crucially hinges on the assumption of bond market structure, i.e. whether household can purchase state-contingent bond. In addition, the country’s foreign asset holding and government’s debt level may have substantial impact on the optimal debt target...
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ژورنال
عنوان ژورنال: Review of Keynesian Economics
سال: 2013
ISSN: 2049-5323,2049-5331
DOI: 10.4337/roke.2013.03.07