Bencivenga, Valerie R.; Huybens, Elisabeth; Smith, Bruce D. - In: International Economic Review 43 (2002) 4, pp. 1289-1307
We consider the question how "best" to maintain price-level stability in an open economy, and evaluate three possible policy choices: (a) a constant money growth rate rule; (b) a fixed exchange rate; and (c) a policy of explicit commitment to a price-level target. In each case we assume that...