EconPapers    
Economics at your fingertips  
 

Choice of inflation targeting: Some international evidence

Shakhzod Ismailov, Makoto Kakinaka and Hiroaki Miyamoto

The North American Journal of Economics and Finance, 2016, vol. 36, issue C, 350-369

Abstract: Inflation targeting has attracted attention to researchers and policy makers since the first attempt in New Zealand in 1990. This paper discusses a country's choice of inflation targeting by examining its driving forces with the dataset of 82 countries. The empirical result shows that countries’ decision of adoption of inflation targeting depends highly on their development stage. For high-income or developed countries, the significant motive of monetary authority to choose inflation targeting is the desire to keep or enhance anti-inflation credibility, and inflation targeting could be a natural option under more floats with the absence of nominal exchange rate anchor. On the other hand, low-income or developing countries with the large size of public debts are not likely to choose inflation targeting, so that fiscal fragility would discourage monetary authority to adopt restrictive monetary policy under inflation targeting.

Keywords: Inflation targeting; Exchange rate arrangements; Anti-inflation credibility; Fiscal fragility (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1062940816300080
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Choice of inflation targeting: Some international evidence (2016) Downloads
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:eee:ecofin:v:36:y:2016:i:c:p:350-369

DOI: 10.1016/j.najef.2016.03.001

Access Statistics for this article

The North American Journal of Economics and Finance is currently edited by Hamid Beladi

More articles in The North American Journal of Economics and Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2025-03-23
Handle: RePEc:eee:ecofin:v:36:y:2016:i:c:p:350-369