Maintaining low inflation: Money, interest rates, and policy stance

• 成果类型: Article; Proceedings Paper
• 署名作者: Reynard, Samuel
• 署名单位: Swiss National Bank (SNB)
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2007.06.018
• 发表日期: 2007
• 页码: 1441-1471
• 关键词: Monetary policy; monetary aggregates; inflation; output; Taylor rule; equilibrium interest rate

摘要

This paper presents a systematic empirical relationship between money and subsequent prices and output, using US, euro area and Swiss data since the 1960-1970s. Monetary developments, unlike interest rate stance measures, are shown to provide qualitative and quantitative information on subsequent inflation. The usefulness of monetary analysis is contrasted to weaknesses in modeling monetary policy and inflation with respectively short-term interest rates and real activity measures. The analysis sheds light on the recent change in inflation volatility and persistence as well as on the Phillips curve flattening, and reveals drawbacks in pursuing a low inflation target without considering monetary aggregates. (c) 2007 Elsevier B.V. All rights reserved.