either price-level or nominal GDP targeting and compare these regimes to inflation targeting. These interest-rate rules are … domain of attraction of the targeted steady state, volatility of inflation and output and sensitivity to the speed of …

Keynesian model we show that, if households have hyperbolic discounting, small positive rates of inflation can be optimal. In … our baseline calibration, the optimal rate of inflation is 2.1% and remains positive across a wide range of calibrations. …

of flexible inflation targeting (price stability and the highest sustainable employment), including keeping average … inflation over a longer period on target; (2) not adding household debt as a new (intermediate) target variable, in addition to … inflation and unemployment – not “leaning against the wind,” which is counterproductive, but leaving any problems with household …

institutions. Such an arrangement is inferior to an optimal inflation targeting, or a Rogoff-style central banker, whose optimal …

macroeconomic behaviour. Inflation targeting is compared to the welfare maximizing monetary rule and to a fixed nominal exchange … rate. It is found that flexible inflation targeting produces too little exchange rate volatility compared to the optimal … rule but delivers higher welfare than a fixed nominal exchange rate. Strict inflation targeting also delivers higher …

announcing a quantified inflation objective, other forms of communication, or by publishing central banks’ inflation and output … (economic) transparency, and given our findings that disagreement among inflation expectations in the general public is not …

United States during the 1990s. Proponents of this approach recommend that, when inflation is moderate but still above the … long-run objective, the central bank should not move immediately to fight inflation, but rather wait for exogenous … circumstances — such as favourable supply shocks and unforeseen recessions — to deliver the desired reduction in inflation. While …

Korea has adopted much of the apparatus of inflation targeting, with a band for target inflation and a Monetary Policy … trade and investment as Korea, currency movements contain information useful for forecasting inflation and the output gap … information relevant for the inflation forecast. In addition, the central bank responds to movements in the exchange rate for …

One test of an exchange-rate peg is to ask whether the implicit inflation target of the pegging country is the same as … that of the anchor country. If the inflation targets of the two countries are different, the peg's long-run credibility …