## Why Inflation Targeting?

_IMF Working Papers, April 1, 2009_

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## Bibliographic details
- Authors: Charles Freedman, Douglas Laxton
- Published: April 1, 2009
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451872330.001

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### Overview
- Chapter 2 of a forthcoming monograph entitled "On Implementing Full-Fledged Inflation-Targeting Regimes: Saying What You Do and Doing What You Say."
- Authors: Charles Freedman, Douglas Laxton
- Publication date: April 1, 2009

### Main findings and analytical focus
- Discusses the costs of inflation, including their role in generating boom-bust cycles.
- Presents a general discussion of the need for a nominal anchor.
- Describes a specific type of monetary anchor: the inflation-targeting regime.
- Identifies two key intellectual roots of inflation targeting:
  - the absence of long-run trade-offs
  - the time-inconsistency problem
- Concludes with a brief introduction to the way in which inflation targeting works.

### Subjects and keywords
- Subject: Conventional peg, Economic theory, Foreign exchange, Inflation, Inflation targeting, Monetary policy, Output gap, Prices, Production, Supply shocks
- Keywords: Africa, Conventional peg, core rate, demand shock, feedback rule, Global, Inflation, inflation equation, inflation expectation, Inflation Targeting, inflation targeting adoption, inflation-targeting regime, Monetary Policy, Output gap, output-inflation process, Supply shocks, targeted rate of inflation, WP

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/why-inflation-targeting-22876_