Inflation Targeting and Inflation Persistence in Asia-Pacific
Stefan Gerlach () and
No 252011, Working Papers from Hong Kong Institute for Monetary Research
Following the Asian financial crisis in 1997-98, a number of Asian central banks adopted inflation targeting. While it is possible for the average inflation rate to be close to target, deviations of inflation could nevertheless be large and protracted. We therefore explore how successful this framework has been by looking at the persistence of inflation, as measured by the sum of the coefficients in an autoregressive model for inflation, using a median unbiased estimator and bootstrapped confidence bands. We find a significant reduction in inflation persistence following the adoption of inflation targeting. The speed by which persistence falls varies across countries. Interestingly, the economies not adopting inflation targeting do not show a decline in persistence. Measuring the performance of monetary policy strategies in terms of inflation persistence rather than the level of inflation shows that inflation targeting performs better than alternative strategies.
Keywords: Inflation Targeting; Asia; Inflation Persistence; Monetary Policy Strategy (search for similar items in EconPapers)
JEL-codes: C22 E31 E5 (search for similar items in EconPapers)
Pages: 29 pages
New Economics Papers: this item is included in nep-cba, nep-mac, nep-mon and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
http://www.hkimr.org/uploads/publication/55/ub_ful ... o-25_2011-final-.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Internal Server Error (http://www.hkimr.org/uploads/publication/55/ub_full_0_2_291_wp-no-25_2011-final-.pdf [301 Moved Permanently]--> http://www.aof.org.hk/research/HKIMR/uploads/publication/55/ub_full_0_2_291_wp-no-25_2011-final-.pdf [301 Moved Permanently]--> https://www.aof.org.hk/research/HKIMR/uploads/publication/55/ub_full_0_2_291_wp-no-25_2011-final-.pdf)
Journal Article: Inflation targeting and inflation persistence in Asia–Pacific (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:hkm:wpaper:252011
Access Statistics for this paper
More papers in Working Papers from Hong Kong Institute for Monetary Research Contact information at EDIRC.
Bibliographic data for series maintained by HKIMR ().