Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/82434
Authors: 
Vestin, David
Year of Publication: 
2000
Series/Report no.: 
Sveriges Riksbank Working Paper Series 106
Abstract: 
This paper examines a price-level target in a model with a forward-looking Calvo-Taylor Phillips curve. Contrary to conventional wisdom, it is found that price-level targeting leads to a better trade-off between inflation and output-gap variability than inflation targeting, when the central bank acts under discretion. In some cases, price-level targeting under dircretion results in the same equilibrium as inflation targeting under commitment.
Subjects: 
Monetary policy
Price-level targeting
Inflation targeting
JEL: 
E52
E58
Document Type: 
Working Paper

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