The article compares the social efficiency of monetary targeting and inflation targeting when central banks may have …. Under inflation targeting and monetary targeting, central banks may have an incentive to signal their private information in … order to influence the public's expectations about future inflation. We show that inflation targeting is superior to …

We introduce a new type of incentive contract for central bankers: inflation forecast contracts, which make central … bankers’ remunerations contingent on the precision of their inflation forecasts. We show that such contracts enable central … bankers to influence inflation expectations more effectively, thus facilitating more successful stabilization of current …

We introduce a new type of incentive contract for central bankers: inflation forecast contracts, which make central … bankers’ remunerations contingent on the precision of their inflation forecasts. We show that such contracts enable central … bankers to influence inflation expectations more effectively, thus facilitating more successful stabilization of current …