Does Inflation Targeting Matter for Labour Markets? – Some Empirical Evidence

Anna Larsson and Johnny Zetterberg
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Anna Larsson: Department of Economics, Stockholm University, and, Postal: FIEF, Wallingatan 38, SE-111 24 Stockholm, Sweden
Johnny Zetterberg: Trade Union Institute for Economic Research, Postal: FIEF, Wallingatan 38, SE-111 24 Stockholm, Sweden
Authors registered in the RePEc Author Service: Anna Seim

No 191, Working Paper Series from Trade Union Institute for Economic Research

Abstract: This paper investigates the impact of inflation targeting on wage formation and unemployment using a panel of 17 OECD countries 1972-2000. Five of the countries included in the study have combined floating exchange rates with explicit inflation targets during the 1990s. Using a theoretical framework for a small open economy, we present simulation results and empirical tests of the model using two different methods. There is some weak evidence that inflation targeting matters for labour markets.

Keywords: Wage bargaining; Monetary regime; Equilibrium (un)employment; Inflation target; Exchange rate target (search for similar items in EconPapers)
JEL-codes: E24 J50 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2003-09-17
New Economics Papers: this item is included in nep-ifn, nep-mac, nep-mfd and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:hhs:fiefwp:0191

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