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- W3140159973 abstract "In stark contrast to the previous literature, we find that IT leads to price indeterminacy even when the central bank uses a Taylor-like feedback rule to peg the nominal interest rate. We also find that there is no mechanism with IT to determine the current inflation rate or price level. We conclude that the previous literature has either committed mathematical errors involving infinity or misused the non-explosive criterion for ruling out speculative bubbles. To avoid making errors involving infinity, we analyze inflation targeting (IT) in a typical rational-expectations, pure-exchange, general-equilibrium model where the time horizon is arbitrarily large, but finite." @default.
- W3140159973 created "2021-04-13" @default.
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- W3140159973 date "2006-12-13" @default.
- W3140159973 modified "2023-09-27" @default.
- W3140159973 title "The Eventual Failure and Price Indeterminacy of Inflation Targeting" @default.
- W3140159973 hasPublicationYear "2006" @default.
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