loss function (corresponding to flexible inflation targeting) is discussed, including the index and level for the inflation … price stability. The benefits of credibility (private inflation expectations coinciding with the inflation target) are … discussed. Credibility improves the tradeoff between inflation variability, output-gap variability and instrument variability …

restrictions on expectations that allow the monetary authority to build credibility for a disinflationary policy by demonstrating …

Central bank credibility plays a pivotal role in much of the modern literature on monetary policy, yet it is difficult … important issues: why credibility matters, and how credibility can be built. The central bankers' answers are compared with the …

evolving Fed credibility, which accords with our recent work using a quantitative New Keynesian model. We define credibility as …, no conflict arises between flexible inflation targeting and maintaining/accumulating credibility. Second, implicit …

more-stringent robustness tests eventually fail could increase the credibility of policy evaluations …

The purpose of this paper is to describe and evaluate the most important existing ideas concerning credibility of …