The purpose of this short paper is to show that inflation “band” targeting can solve the “time inconsistency” problem … that exists under inflation “point” targeting by setting a relevant target range. Moreover, we show that inflation band … natural levels, by setting the inflation rate within a target range and creating unexpected inflation. 2) It can mitigate …

We empirically characterize episodes of large inflation surges that have been observed worldwide in the last three … decades. We document four facts. (1) Inflation surges tend to be persistent, with the duration of disinflation exceeding that … of the initial inflation increase. (2) Surges are initially unexpected but followed by a gradual catch-up of average …

on output and, in particular, also on inflation in the euro area under alternative settings for monetary policy. We … that this over-proportionality is stronger for the fiscal multiplier on inflation than on output. We relate this finding to …

inflation targeter early in this period but began to pay less attention to inflation after 2009. Loss of the strong nominal …

inflation targeter early in this period but began to pay less attention to inflation after 2009. Loss of the strong nominal …

We examine the dynamic properties of inflation in a model of optimal discretionary fiscal and monetary policies. The … policies which induce positive and persistent inflation rates. We show that this property obtains already in an environment … model generates inflation dynamics very similar to those experienced in the U.S. since the Volcker disinflation of the early …

stabilizer and controls inflation, while monetary policy pegs the nominal interest rate. When evaluated through the lens of a … rate, fiscal activism can substantially outperform inflation targeting in the face of both demand shocks and technology …

power of income index and the Fisher Equation allows up to a 15% inflation target without the costs of inflation? It is a … most of the costs of inflation including the relative price distortion through the price tag (by disclosing the nominal … of inflation targeting that can combat the Global Financial Crisis. The impetus for its adoption across the developed …