Bhattacharya, Joydeep; Kudoh, Noritaka - 2002
This paper reconsiders the link between tight money policies and inflation in the spirit of Sargent and Wallace's (1981 … return-dominated currency is used to study the long-run effects on inflation of a tightening of monetary policy engineered … arithmetic can be stable. In contrast, when monetary policy is conducted via an inflation target rule, the only stable …
