The past three decades have seen an extraordinary transformation in the conduct of monetary policy. In the 1970s, inflation had risen to very high levels, with most countries, including the United States, experiencing inflation rates in the double digits. Today, almost all nations in the world are in a low inflation environment. Of 223 countries, 193 currently have annual inflation rates less t...

This paper investigates whether Taylor rule can better guide the monetary policy in developing economies. Existing literatures do not focus on the implementability of rule-based monetary policy in emerging economies. In last two decades a number of industrialised countries have gained success in achieving macroeconomic policy goals by switching to rule-based policy regime from discretionary fra...

I am pleased to address this conference commemorating the twenty-fifth anniversary of the historic monetary policy changes implemented in October 1979. In my prepared remarks, I would like to focus on two issues with respect to safeguarding good monetary policy practice. First, I will discuss what constitutes good monetary policy practice and review the Federal Reserve’s record in satisfying it...

The EMU accession countries are obliged to fulfill the Maastricht convergence criteria prior to entering the EMU. What should be the optimal monetary policy satisfying these criteria? To answer this question, the paper proposes a DSGE model of a two-sector small open economy. First, I derive the micro founded loss function that represents the objective function of the optimal monetary policy no...