A Critical View of Inflation Targeting: Crises, Limited Sustainability, and Aggregate Shocks

Working Papers from Stanford University, Department of Economics

Abstract: November 2000

This paper presents a critical appraisal of inflation targeting as a monetary policy regime for emerging markets. It is shown that this policy, if understood as a strict commitment to a CPI inflation target, shares many features with exchange rate targeting and is quite different from inflexible exchange rates under money growth rules. Inflation targets are vulnerable to speculative attacks, although less so than exchange rate targets. They perform worse than exchange rate targets when policy sustainability is limited. And their relative performance under exogenous shocks, not surprisingly, depends on the nature and direction of those shocks. Given this lack of an obvious advantage over exchange rate targets, the real attraction of inflation targets may be that they give the policymaker discretion. This, in the context of many emerging markets, has to be a cause for concern. Keywords: intellectual property rights, copyright, sui generis protection of expressive material, economics of information-goods, open science, "fair use," scientific databases.

JEL Classification: H4, K39, O31, O34 -->

Keywords: intellectual property rights; copyright; sui generis protection of expressive material; economics of information-goods; open science (search for similar items in EconPapers)
JEL-codes: H4 K39 O31 O34 (search for similar items in EconPapers)
Date: 2000-11
New Economics Papers: this item is included in nep-ifn and nep-mon
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www-econ.stanford.edu/faculty/workp/swp00022.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www-econ.stanford.edu/faculty/workp/swp00022.pdf [301 Moved Permanently]--> https://www-econ.stanford.edu/faculty/workp/swp00022.pdf [307 Temporary Redirect]--> https://economics.stanford.edu//faculty/workp/swp00022.pdf)

Related works:
Chapter: A Critical View of Inflation Targeting: Crises, Limited Sustaintability, and Aggregate Shocks (2002)
Working Paper: A Critical View of Inflation Targeting: Crises, Limited Sustainability, and Aggregate Shocks (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wop:stanec:00022

Access Statistics for this paper

More papers in Working Papers from Stanford University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Thomas Krichel ().