We consider the properties of two monetary policy rules ("strict inflation targeting", "constant money growth rule") in … nominal terms. Under a constant money growth rule which allows for temporary deviations of inflation from target in response … contrast, a policy of strict inflation targeting implements the target inflation rate also outside the steady state and …

Since the 2001 recession, average core inflation has been below the Federal Reserve's 2% target. This deflationary bias … corrects the bias and brings inflation back on target. Adopting this asymmetric rule improves welfare and reduces the risk of …

This paper analyzes intergenerational redistribution in a 2-period overlapping- generations model that allows for … political economy equilibrium is not Pareto-efficient. Redistribution results in equal consumption levels of individuals with …

In this paper redistribution policy is analyzed in a 2-period overlapping generations model with heterogeneous …

with markedly different long run implications are examined: inflation targeting and price-level targeting. Optimal … indexation differs significantly under the two regimes. Under inflation targeting, long-term inflation uncertainty is substantial … relatively high (76 per cent). With price-level targeting, by contrast, long-term inflation uncertainty is minimal because the …

We analyse the interaction between private agents? uncertainty about inflation target and the central bank's data … uncertainty. In our model, private agents update their perceived inflation target and the central bank estimates unobservable … economic shocks as well as the perceived inflation target. Under those two uncertainties, the learning process of both private …

-term inflation risk is reduced by an order of magnitude compared to inflation targeting. Consequently, real bond returns are …