Research Portal

Inflation targeting in developing countries revisited

Research output: Contribution to journal › Article › peer-review

Standard Standard

Inflation targeting in developing countries revisited. / Thornton, John.
In: Finance Research Letters, Vol. 16, No. 2, 02.2016, p. 143-153.

Research output: Contribution to journal › Article › peer-review

HarvardHarvard

Thornton, J 2016, 'Inflation targeting in developing countries revisited', Finance Research Letters, vol. 16, no. 2, pp. 143-153. https://doi.org/10.1016/j.frl.2015.10.024

APA

Thornton, J. (2016). Inflation targeting in developing countries revisited. Finance Research Letters, 16(2), 143-153. https://doi.org/10.1016/j.frl.2015.10.024

CBE

Thornton J. 2016. Inflation targeting in developing countries revisited. Finance Research Letters. 16(2):143-153. https://doi.org/10.1016/j.frl.2015.10.024

MLA

Thornton, John. "Inflation targeting in developing countries revisited". Finance Research Letters. 2016, 16(2). 143-153. https://doi.org/10.1016/j.frl.2015.10.024

VancouverVancouver

Thornton J. Inflation targeting in developing countries revisited. Finance Research Letters. 2016 Feb;16(2):143-153. Epub 2015 Nov 10. doi: 10.1016/j.frl.2015.10.024

Author

Thornton, John. / Inflation targeting in developing countries revisited. In: Finance Research Letters. 2016 ; Vol. 16, No. 2. pp. 143-153.

RIS

TY - JOUR

T1 - Inflation targeting in developing countries revisited

AU - Thornton, John

PY - 2016/2

Y1 - 2016/2

N2 - In a recent paper, Gonçalvez and Salles (2008) (G–S) report that developing countries adopting the inflation targeting (IT) regime experienced greater drops in inflation and GDP growth volatility than non-inflation targeting developing countries. In this paper, I find that the G–S results do not hold up when their analytical framework is employed in the context of a more rational and larger sample of de- veloping countries that controls for the comparability of monetary regimes as suggested by Ball (2010). In particular, adoption of an IT regime did not help reduce inflation and growth volatility in developing countries compared to the average experience with other monetary regimes and was no more advantageous in these regards than the adoption of a hard or crawling peg exchange rate regime. As such, the less technically demanding monetary regime of currency pegging remains an attractive regime option for policymakers in developing countries.

AB - In a recent paper, Gonçalvez and Salles (2008) (G–S) report that developing countries adopting the inflation targeting (IT) regime experienced greater drops in inflation and GDP growth volatility than non-inflation targeting developing countries. In this paper, I find that the G–S results do not hold up when their analytical framework is employed in the context of a more rational and larger sample of de- veloping countries that controls for the comparability of monetary regimes as suggested by Ball (2010). In particular, adoption of an IT regime did not help reduce inflation and growth volatility in developing countries compared to the average experience with other monetary regimes and was no more advantageous in these regards than the adoption of a hard or crawling peg exchange rate regime. As such, the less technically demanding monetary regime of currency pegging remains an attractive regime option for policymakers in developing countries.

U2 - 10.1016/j.frl.2015.10.024

DO - 10.1016/j.frl.2015.10.024

M3 - Article

VL - 16

SP - 143

EP - 153

JO - Finance Research Letters

JF - Finance Research Letters

SN - 1544-6123

IS - 2

ER -