TY  - UNPD
A1  - Honkapohja, Seppo
A1  - Mitra, Kaushik
T1  - Performance of inflation targeting based on constant interest rate projections
T2  - Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2003,39
N2  - Monetary policy is sometimes formulated in terms of a target level of inflation, a fixed time horizon and a constant interest rate that is anticipated to achieve the target at the specified horizon. These requirements lead to constant interest rate (CIR)instrument rules. Using the standard New Keynesian model, it is shown that some forms of CIR policy lead to both indeterminacy of equilibria and instability under adaptive learning. However, some other forms of CIR policy perform better. We also examine the properties of the different policy rules in the presence of inertial demand and price behaviour.
T3  - CFS working paper series - 2003, 39 
KW  - indeterminacy
KW  - instability under learning
KW  - inflation targeting
KW  - inertia in demand
KW  - inflation inertia
Y1  - 2003
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/4452
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30-10441
ER  -