One Decade of Inflation Targeting in the World: What Do We Know and What Do We Need to Know?

48 Pages Posted: 29 Jul 2001 Last revised: 10 Jan 2010

See all articles by Frederic S. Mishkin

Frederic S. Mishkin

Columbia Business School - Finance and Economics; National Bureau of Economic Research (NBER)

Klaus Schmidt-Hebbel

Central Bank of Chile

Date Written: July 2001

Abstract

One decade of inflation targeting in the world offers lessons on the design and implementation of inflation targeting, the conduct of monetary policy, and country performance under inflation targeting. This paper reviews briefly the main design features of 18 inflation targeting experiences, analyzes statistically if countries under inflation targeting are structurally different from non-inflation targeting industrial countries, and reviews existing evidence about the success of inflation targeting. The interaction of inflation targeting design features and the conduct of monetary policy during transition to low inflation are tackled next. The paper ends by focusing on unresolved issues on design and implementation of inflation targeting and their relation to the conduct of monetary policy open issues that have to be addressed in the next decade of inflation targeting.

Suggested Citation

Mishkin, Frederic S. and Schmidt-Hebbel, Klaus, One Decade of Inflation Targeting in the World: What Do We Know and What Do We Need to Know? (July 2001). NBER Working Paper No. w8397. Available at SSRN: https://ssrn.com/abstract=278030

Frederic S. Mishkin (Contact Author)

Columbia Business School - Finance and Economics ( email )

3022 Broadway
New York, NY 10027
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Klaus Schmidt-Hebbel

Central Bank of Chile ( email )

Agustinas 1180
Santiago
Chile
(56-2) 670-2386, 670-2586 (Phone)
(56-2) 670-2836 (Fax)

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