This paper investigates the design of monetary policy in inflation targeting regimes. It is partly motivated by our view that, despite the widespread adoption on inflation targeting regimes in a number of countries including the UK, the policy debate is insufficiently concerned with the central...

This paper is concerned with the calculation of time consistent macroeconomic policies. We provide a taxonomy for four different infinite horizon time consistent equilibria, combining Nash and Stackelberg behaviour on the part of the policymaker with either open loop or feedback strategies. We...