Comment on Michael Woodford , “ Inflation Targeting and Financial Stability ”
نویسنده
چکیده
Michael Woodford’s paper “Inflation Targeting and Financial Stability” presents a case for tighter monetary policy, “leaning against the wind,” in order to reduce the probability of a financial crisis. However, the introduction of financial-stability instruments (macroprudential instruments) that have a more direct effect on leverage than the policy rate allows monetary-policy and financial-stability policy to be conducted separately, with monetary policy focusing on the traditional objective of stabilizing inflation and resource allocation and financial-stability policy focusing on the objective of financial stability.
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