"Interpretations of inflation targeting (IT) have ranged widely, from "inflation-only targeting" without regard for output, to cheap talk without effect, to transparency increasing flexibility without cost. We characterize five interpretations of the adoption if IT as shifts between strategies...

Interpretations of inflation targeting (IT) have ranged widely, from "inflation-only targeting" without regard for output, to cheap talk without effect, to transparency increasing flexibility without cost. We characterize five interpretations of the adoption of IT as shifts between strategies in...