The global economy of the twenty-first century is characterised by rapid changes which create both threats and opportunities. The biggest challenge for the european economy is to become sufficiently flexible so as to avail of the opportunities and surmount the threats. This requires, above all,...

The purpose of this paper is to analyse the characteristics of an inflation targeting strategy, using the Barro-Gordon model specific tools. This paper uses the initial Barro-Gordon concepts of inflationary social costs and benefits, adding a new dimension generated by the cost of output...