Impact of Inflation Targeting on Inflation Volatility

DOI

抄録

In this study, we investigate the impact of the inflation targeting (IT) regime on inflation volatility by applying treatment effects to a panel of 186 countries for the 1980–2018 period. We apply the differences-in-differences estimation to evaluate the pre-and post-adoption impact of the IT policy on reducing inflation volatility. Our estimation results demonstrate that IT countries have significantly reduced inflation volatility compared with non-IT countries. However, several countries suffer from historic hyperinflation, which significantly impacts IT after its adoption. Central banks adopt a similar price stability-centric approach in monetary policy execution. The crucial elements needed for effective IT policy implementation include financial market maturity, effective monetary policy transmission, and the overall macroeconomic stability of countries.

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詳細情報 詳細情報について

  • CRID
    1390573482959605632
  • DOI
    10.34409/rjaps.40.1_22
  • ISSN
    24324302
    13444204
  • 本文言語コード
    en
  • データソース種別
    • JaLC
  • 抄録ライセンスフラグ
    使用不可

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