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Central Bank Performance under Inflation Targeting

Gosselin, Marc-André - Bank of Canada - 2007

The inflation targeting (IT) regime is 17 years old. With practice of IT now in more than 21 countries, there is enough evidence gathered to take stock of the IT experience. In this paper, we analyze the inflation record of IT central banks. We extend the work of Albagli and Schmidt-Hebbel...

Persistent link: https://www.econbiz.de/10005162440

Alternative Optimized Monetary Policy Rules in Multi-Sector Small Open Economies: The Role of Real Rigidities

Resende, Carlos de; Dib, Ali; Kichian, Maral - Bank of Canada - 2010

Inflation-targeting central banks around the world often state their inflation objectives with regard to the consumer price index (CPI). Yet the literature on optimal monetary policy based on models with nominal rigidities and more than one sector suggests that CPI inflation is not always the...

Persistent link: https://www.econbiz.de/10008562476

Should Central Banks Adjust Their Target Horizons in Response to House-Price Bubbles?

Roi, Meenakshi Basant; Mendes, Rhys R. - Bank of Canada - 2007

The authors investigate the implications of house-price bubbles for the optimal inflation-target horizon using a dynamic general-equilibrium model with credit frictions, house-price bubbles, and small open-economy features. They find that, given the distribution of shocks and inflation...

Persistent link: https://www.econbiz.de/10005673249

Aggregate and Welfare Effects of Redistribution of Wealth Under Inflation and Price-Level Targeting

Meh, Césaire A.; Rios-Rull, José-Victor; Terajima, Yaz - Bank of Canada - 2008

Since the work of Doepke and Schneider (2006a) and Meh and Terajima (2008), we know that inflation causes major redistribution of wealth - between households and the government, between nationals and foreigners, and between households within the same country. Two types of monetary policy,...

Persistent link: https://www.econbiz.de/10005673256

Inflation Targeting Under Asymmetric Preferences

RUGE-MURCIA, Francisco .J. - Département de Sciences Économiques, Université de … - 2001

This paper develops and estimates a game-theoretical model of inflation targeting where the central banker's preferences are asymmetric around the targeted rate. In particular, positive deviations from the target can be weighted more, or less, severely than negative ones in the central banker's...

Persistent link: https://www.econbiz.de/10005545659

The Zero Bound on Nominal Interest Rates: How Important Is It?

Amirault, David; O'Reilly, Brian - Bank of Canada - 2001

credibility. …

Persistent link: https://www.econbiz.de/10005162504

Gaining Credibility for Inflation Targets

Yetman, James - Bank of Canada - 2001

by observing the policy instrument or inflation outcomes. Measuring credibility as the distance between the perceived … target and the actual target, an increase in credibility is beneficial to the central bank because it brings the policy …-order approximation for reasonable degrees of initial credibility, and may actually be preferable if agents cannot determine the exact …

Persistent link: https://www.econbiz.de/10005162512

Why central banks undershoot their inflation targets

Škop, Jiří - In: Politická ekonomie 2005 (2005) 2

The goal of this article is to explain why central banks undershoot their inflation targets as we can observe also in the case of the Czech Republic. In other words, I am trying to find out if this undershooting is due to unpredictable desinflation shocks or due to asymmetric behaviour of...

Persistent link: https://www.econbiz.de/10005036617

Adopting price-level targeting under imperfect credibility

Kryvtsov, Oleksiy; Shukayev, Malik; Ueberfeldt, Alexander - 2008

credibility. Vestin (2006) shows that when the monetary authority cannot commit to future policy, price-level targeting yields … higher welfare than inflation targeting. We revisit this issue by introducing imperfect credibility, which is modeled as …

Persistent link: https://www.econbiz.de/10010279875

Are bygones not bygones? Modeling price level targeting with an escape clause and lessons from the gold standard

Masson, Paul R.; Shukayev, Malik D. - 2008

some parameterizations, there is a low credibility equilibrium (with high expectation of a reset) associated with high …

Persistent link: https://www.econbiz.de/10010280015