Why did inflation targeting fail in Argentina?

Nicolas Cachanosky and Federico Julián Ferrelli Mazza

The Quarterly Review of Economics and Finance, 2021, vol. 80, issue C, 102-116

Abstract: Argentina’s experience with inflation targeting started in 2016 and ended in 2018, lasting a total of only 25 months. In this paper, we study the reasons why this monetary regime failed in Argentina. We argue that the main reason for its failure was an internal inconsistency in how the central bank implemented inflation targeting, and a negative credibility shock accelerated that said inconsistency in December 2017.

Keywords: Argentina; Inflation targeting; Central bank credibility; Expectations (search for similar items in EconPapers)
JEL-codes: E31 E52 E58 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:quaeco:v:80:y:2021:i:c:p:102-116

DOI: 10.1016/j.qref.2021.01.014

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