predictability varies over time, however, particularly across different monetary regimes. In accord with our proposed theory, regimes … with low credibility (high persistence of inflation) tend to have better predictability …

external shocks, lower credibility, and lower level of development of institutions in these countries. In order to improve …

We revisit the question of what determines the credibility of macroeconomic policies here, of promises to repay public … probability, much conventional wisdom on the determinantes of credibility need no longer hold. For instance, appointing a … conservative policymaker or denominating public debt in foreign currency may reduce, not increase, credibility …