The Performance of Alternative Monetary Regimes
NBER Working Paper No. 16124
This paper compares the performance of economies with different monetary regimes during the last quarter century. The conclusions include: (1) There is little evidence that inflation targeting affects performance in advanced economies, but some evidence of benefits in emerging economies; (2) Europe's monetary union has increased intra-European trade and capital flows, but divergence in national price levels may destabilize output in the future; (3) The "monetary analysis" of the European Central Bank has little effect on the ECB's policy decisions; and (4) Countries with hard currency pegs experience unusually severe recessions when capital flight occurs.
Document Object Identifier (DOI): 10.3386/w16124
Published: “The Performance of Alternative Monetary Regimes,” in Friedman and Woodford (eds.), Handbook of Monetary Economics , North Holland Press, 2011.
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