Arbeitspapier
Average is good enough: Average-inflation targeting and the ELB
The Great Recession and current pandemic have focused attention on the constraint on nominal interest rates from the effective lower bound. This has renewed interest in monetary policies that embed makeup strategies, such as price-level or average-inflation targeting. This paper examines the properties of average-inflation targeting in a two-agent New Keynesian (TANK) model in which a fraction of firms have adaptive expectations. We examine the optimal degree of history dependence under average-inflation targeting and find it to be relatively short for business cycle shocks of standard magnitude and duration. In this case, we show that the properties of the economy are quantitatively similar to those under a pricelevel target.
- Sprache
-
Englisch
- Erschienen in
-
Series: Bank of Canada Staff Working Paper ; No. 2020-31
- Klassifikation
-
Wirtschaft
Price Level; Inflation; Deflation
Business Fluctuations; Cycles
Monetary Policy
- Thema
-
Monetary policy framework
Business fluctuations and cycles
Economic models
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Amano, Robert A.
Gnocchi, Stefano
Leduc, Sylvain
Wagner, Joel
- Ereignis
-
Veröffentlichung
- (wer)
-
Bank of Canada
- (wo)
-
Ottawa
- (wann)
-
2020
- DOI
-
doi:10.34989/swp-2020-31
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Amano, Robert A.
- Gnocchi, Stefano
- Leduc, Sylvain
- Wagner, Joel
- Bank of Canada
Entstanden
- 2020
Ähnliche Objekte (12)
Average Inflation Targeting
Central bank performance under inflation targeting
Price level versus inflation targeting under model uncertainty
Targeting Inflation from Below - How Do Inflation Expectations Behave?
Monetary policy lag, zero lower bound, and inflation targeting
On robustness of average inflation targeting
Would households understand average inflation targeting?
Would households understand average inflation targeting?
Price level targeting
Mr. Average
Mr. Average
Mr. Average
Average Inflation Targeting
Central bank performance under inflation targeting
Price level versus inflation targeting under model uncertainty
Targeting Inflation from Below - How Do Inflation Expectations Behave?
Monetary policy lag, zero lower bound, and inflation targeting
On robustness of average inflation targeting
Would households understand average inflation targeting?
Would households understand average inflation targeting?
Price level targeting
Mr. Average
Mr. Average
Mr. Average
Average Inflation Targeting
Central bank performance under inflation targeting
Price level versus inflation targeting under model uncertainty
Targeting Inflation from Below - How Do Inflation Expectations Behave?
Monetary policy lag, zero lower bound, and inflation targeting
On robustness of average inflation targeting
Would households understand average inflation targeting?
Would households understand average inflation targeting?
Price level targeting
Mr. Average
Mr. Average