Thursday, August 25, 2022

The Incentives For Inflation "Targeting" — Brian Romanchuk

Now that the furore about Modern Monetary Theory (MMT) has died down (other than the continuous pathetic strawman attacks), I am seeing a downtick in economic theory arguments that I find interesting. People are arguing about the details of fiscal policy and what is happening with inflation, which end up either being political or datamining time seri…

One theoretical topic that comes up is the idea of nominal GDP targeting. I have doubts about nominal GDP targeting, the main one being that it is difficult to dislodge something like an inflation target (I am not concerned with the details of the policy framework). In this article, I explain the political attractions of inflation targeting before turning to nominal GDP targeting....
Bond Economics
The Incentives For Inflation "Targeting"
Brian Romanchuk

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