Inflation targeting in low-income countries: Does IT work?

Arbeitspapier

Previous research on inflation targeting (IT) has focused on high-income countries (HICs) and emerging market economies (EMEs). Only recently has enough data accumulated for the performance of IT in low-income countries (LICs) to be assessed. We show that IT has not so far been as effective in reducing inflation in LICs as in EMEs. Relatively weak institutions, a typical feature of LICs, help explain this result. Our interpretation is that poor institutions, leaving fiscal policy unconstrained, impair central banks' ability to conduct monetary policy in a way consistent with IT.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CREDIT Research Paper ; No. 20/01

Classification and Topics

• Classification: Wirtschaft ; Monetary Policy ; Central Banks and Their Policies ; Fiscal and Monetary Policy in Development
• Subject: Inflation targeting ; Low-income countries ; Institutions

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bleaney, Michael F. ; Morozumi, Atsuyoshi ; Mumuni, Zakari
• Event: Veröffentlichung
• (who): The University of Nottingham, Centre for Research in Economic Development and International Trade (CREDIT)
• (where): Nottingham
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/250291
• Last update: 10.03.2025, 11:44 AM CET