Inflation Control: Do Central Bankers Have It Right?

By Stephen Williamson in Review. Neo-Fisherites argue that conventional central banking wisdom has inflation control wrong, in that the way to increase (reduce) inflation is to increase (reduce) the central bank’s nominal interest rate target. This article shows how two conventional macroeconomic monetary models—a New Keynesian (NK) model and a segmented markets model—exhibit neo-Fisherian properties.

Source: St. Louis Fed - Recent Research
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