Chapter 16 The Conduct Of Monetary Policy: Strategy & Tactics
Tactics: The Taylor Rule
Lessons for Monetary Policy Strategy from the Global Financial Crisis
The Price Stability Goal and the Nominal Anchor
The Federal Reserve’s Monetary Policy Strategy
Tactics: Choosing the Policy Instrument
Advantages of the Fed’s “Just Do It” Approach
Disadvantages of the Fed’s “Just Do It” Approach.
Implications for Inflation Targeting
How Should Central Banks Respond to Asset-Price Bubbles?
Criteria for Choosing the Policy Instrumen
The Role of a Nominal Anchor
The Time-Inconsistency Problem
Inflation Targeting
Should Price Stability be the Primary Goal of Monetary Policy?
Other Goals of Monetary Policy
Economic Growth
Stability of Financial Markets
Interest-Rate Stability
High Employment and Output Stability
Stability in Foreign Exchange Markets
Hierarchical Versus Dual Mandates.
Price Stability as the Primary, Long-Run Goal of Monetary Policy
Advantages of Inflation Targeting
Advantages of Inflation Targeting
Inflation Targeting in New Zealand, Canada, and the United Kingdom