Allowing for time-varying treatment effects, this paper provides new findings on the effects of inflation targeting on economic performance over time. First, developed countries lower inflation and reach their targets rapidly in two years and developing countries reduce inflation gradually in...

Recent studies evaluate the effectiveness of inflation targeting through the average treatment effect and generally conclude the window-dressing view of the monetary policy for industrial countries. This paper argues that the evidence of irrelevance emerges because of a time-varying relationship...

Recent studies that evaluate inflation targeting through average treatment effects generally conclude the window-dressing view for industrial countries and policy effectiveness for developing countries. Allowing for a time-varying relationship (treatment effect) between the monetary policy and...