Do Inflation-Targeting Central Banks Implicitly Target the Price Level?
dc.contributor.author | Ruge-Murcia, Francisco | |
dc.date.accessioned | 2010-07-29T16:46:31Z | |
dc.date.available | 2010-07-29T16:46:31Z | |
dc.date.issued | 2009-12 | |
dc.identifier.uri | http://hdl.handle.net/1866/4000 | |
dc.publisher | Université de Montréal. Département de sciences économiques. | fr |
dc.subject | Inflation-targeting | en |
dc.subject | price-level targeting | en |
dc.subject | unit-root tests | en |
dc.subject | E3, E5 | en |
dc.title | Do Inflation-Targeting Central Banks Implicitly Target the Price Level? | en |
dc.type | Article | en |
dc.contributor.affiliation | Université de Montréal. Faculté des arts et des sciences. Département de sciences économiques | |
dcterms.abstract | This paper reports graphical and statistical evidence that the inflation targeting regimes in Canada and the UK - but not in Australia, New Zealand, or Sweden - actually resemble price-level targeting. In particular, the price level closely tracks the path implied by the inflation target, and the time-series predictions of the "bygones-are-bygones" version of inflation targeting are rejected by the data in favor of those implied by price-level targeting. These results indicate heterogeneity in the actual application of inflation targeting across countries and, for Canada and the UK, imply that the characterization of inflation targeting as a policy where shocks are accommodated is at odds with the data. Moreover, up to extent that their current policies already resemble price-level targeting, the welfare gains of replacing inflation with (explicit) price-level targeting are likely to be small. | en |
dcterms.isPartOf | urn:ISSN:0709-9231 | |
dcterms.language | eng | en |
UdeM.VersionRioxx | Version publiée / Version of Record | |
oaire.citationTitle | Cahier de recherche | |
oaire.citationIssue | 2009-15 |
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