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Inflation Targeting: A New Framework for Monetary Policy?

Inflation Targeting: A New Framework for Monetary Policy? Abstract In recent years, a number of industrialized countries have adopted a strategy for monetary policy known as ‘inflation targeting.’ The authors describe how this approach has been implemented in practice and argue that it is best understood as a broad framework for policy, which allows the central bank ‘constrained discretion,’ rather than as an ironclad policy rule in the Friedman sense. They discuss the potential of the inflation-targeting approach for making monetary policy more coherent and transparent and for increasing monetary policy discipline. The authors' final section addresses some additional practical issues raised by this approach. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economic Perspectives American Economic Association

Inflation Targeting: A New Framework for Monetary Policy?

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Publisher
American Economic Association
Copyright
Copyright © 1997 by the American Economic Association
Subject
Articles
ISSN
0895-3309
DOI
10.1257/jep.11.2.97
Publisher site
See Article on Publisher Site

Abstract

Abstract In recent years, a number of industrialized countries have adopted a strategy for monetary policy known as ‘inflation targeting.’ The authors describe how this approach has been implemented in practice and argue that it is best understood as a broad framework for policy, which allows the central bank ‘constrained discretion,’ rather than as an ironclad policy rule in the Friedman sense. They discuss the potential of the inflation-targeting approach for making monetary policy more coherent and transparent and for increasing monetary policy discipline. The authors' final section addresses some additional practical issues raised by this approach.

Journal

Journal of Economic Perspectives – American Economic Association

Published: May 1, 1997

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