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Article: Inflation targeting for the United States?
- Article from:
- The Cato Journal
- Article date:
- March 22, 2007
- Author:
CopyrightCOPYRIGHT 2007 Cato Institute. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Is inflation targeting suitable for the United States? I am inclined to say "Yes," but there are some issues and qualifications that need to be discussed. First, what is inflation targeting? Second, are there political problems that are likely to arise? Third, what about the arguments suggesting that inflation targeting has not provided benefits to those nations that have adopted it? Fourth, what about the analytical components of models typically used to analyze inflation targeting? These topics will be taken up in the sections that follow.
What Is Inflation Targeting?
When the term "inflation targeting" first began to be used frequently, around 1990, ...