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Inflation in advanced economies is low by historical standards but there is no threat of deflation. Slower economic … growth is caused by supply-side constraints rather than low inflation. Below-the-target inflation does not damage the … reputation of central banks. Thus, central banks should not try to bring inflation back to the targeted level of 2%. Rather, they …
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bankers to explain their monetary policy decisions in detail and for them to publish inflation forecasts. This leads to the … question of how central bank transparency is entangled with price stability and inflation volatility. A plethora of studies … transparency leads to lower inflation, others concluded that openness of central banks results in higher prices. Conversely, there …
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and conservativeness, the literature on optimal inflation contracts is discussed, followed by research in which the … are reviewed. We conclude that the negative relationship between CBI and inflation is quite robust …
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