TY  - JOUR
AU  - Mishkin,Frederic S.
AU  - Posen,Adam S.
TI  - Inflation Targeting: Lessons from Four Countries
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6126
PY  - 1998
Y2  - February 1998
UR  - http://www.nber.org/papers/w6126
L1  - http://www.nber.org/papers/w6126.pdf
N1  - Author contact info:
Frederic S. Mishkin
Columbia University
Graduate School of Business
Uris Hall 817
3022 Broadway
New York, NY 10027
Tel: 212-854-3488
Fax: 212/662-8474
E-Mail: fsm3@columbia.edu

Adam Posen
Peter G. Peterson Institute for International Econ
1750 Massachusetts Ave., NW
Washington, DC 20036-1903
Tel: 202-328-9000
Fax: 202-328-5432
E-Mail: adam.posen@bankofengland.co.uk
M2  - featured in NBER digest on 1998-04-01
AB  - In recent years, a number of central banks have announced numerical inflation targets as the basis for their monetary strategies.  After outlining the reasons why such strategies might be adopted in the pursuit of price stability, this study examines the adoption, operational design, and experience of inflation targeting as a framework for monetary policy in the first three countries to undertake such strategies New Zealand, Canada, and the United Kingdom.  It also analyzes the operation of the long-standing German monetary targeting regime, which incorporated many of the same features as later inflation-targeting regimes.  The key challenge for all these monetary" frameworks has been the appropriate balancing of transparency and flexibility in policymaking.  The study finds that all of the targeting countries examined have maintained low rates of inflation and increased the transparency of monetary policymaking without harming the real economy through policy rigidity in the face of economic developments.  A convergence of design choices on the part of targeting countries with regard to operational questions emerges from this comparative study, suggesting some lines of best practice for inflation-targeting frameworks.
ER  -