Ascari, Guido; Florio, Anna - Dipartimento di Scienze Economiche e Aziendali, … - 2012
transparency is an essential component of the inflation targeting framework and it helps anchoring expectations. However, the …This paper proves that a higher inflation target unanchors expectations, as feared by Fed Chairman Bernanke. It does so … transition phase, because it slows down the speed of convergence of expectations. Moreover, the higher the inflation target, the …