This study revisits and tests empirically the Portfolio Theory of Inflation (PTI), which analyzes how the effectiveness … (Bossone, The portfolio theory of inflation and policy (in)effectiveness, 2019). The PTI shows that when an economy is heavily …

The Portfolio Theory of Inflation (PIT) proposed in this study investigates the role of global financial markets in … policy credibility: when a country's credibility is low, they hold its economy to a tighter intertemporal budget constraint … credibility creates space for effective and noninflationary macro policies but, if such space is abused, credibility gets …

taken by domestic agents. The Portfolio Theory of Inflation (PTI) developed in this study assumes that some critical … resources internationally based, inter alia, on the perceived policy credibility of the national authorities and their policies …. The PTI shows that when a country has low credibility and is heavily indebted, investors hold its economy to a tighter …

In most countries, the central bank is required to hold reserve assets as a means of providing credibility for the …