The Illusion of Inflation Targeting: Have Central Banks Figured Out What They Are Actually Doing Since the Global Financial Crisis? An Alternative to the Mainstream Perspective

Mario Seccareccia and Najib Khan

International Journal of Political Economy, 2019, vol. 48, issue 4, 364-380

Abstract: Current discussions over the behavior of central banks show that more and more political leaders are demanding that the monetary authorities abandon a single-goal mandate of solely combating inflation. Many are considering a multi-goal commitment that would include not only concern with inflation, as had been the case before the global financial crisis. Central banks should also give due consideration to the problem of unemployment, income distribution and macro-prudential risks in their interest-rate setting. By looking at the experience of fourteen inflation-targeting countries since the global financial crisis, empirical evidence suggests that central banks have shifted significantly their behavior and have shown a high degree of pragmatism in dealing with the aftermath of the financial crisis, by loosening their focus on inflation. Using an alternative post-Keynesian analytical framework, the article then proceeds with an analysis of how central banks can effectively achieve a multi-goal commitment that would include full employment and a more equitable distribution of income in their pursuit of monetary policy.

Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/10.1080/08911916.2019.1693164 (text/html)
Access to full text is restricted to subscribers.

Related works:
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:mes:ijpoec:v:48:y:2019:i:4:p:364-380

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/MIJP20

DOI: 10.1080/08911916.2019.1693164

Access Statistics for this article

More articles in International Journal of Political Economy from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().