In noise we trust? Optimal monetary policy with random targets

We show that a monetary policy in which the central bank commits to a randomized inflation target allows for potentially faster-expectations convergence than with a fixed target. The randomized target achieves faster convergence in particular in transition environments: those demonstrating either particularly high or low inflation. ; Quantitative Analysis Unit Working Paper QAU07-1

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Year of publication:	2006
Authors:	Cohen-Cole, Ethan ; Cosmaciuc, Bogdan
Institutions:	Federal Reserve Bank of Boston
Subject:	Monetary policy

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Extent:	text/html application/pdf
Series:	Working Papers.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 06-14
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005713314