Conceptual and practical aspects of inflation targeting
Burlachkov V. K.1
, Pausheva T.E.2
1 Московский государственный институт международных отношений (Университет) МГИМО МИД России
2 Российский экономический университет им. Г.В. Плеханова
Download PDF | Downloads: 38
Journal paper
Russian Journal of Entrepreneurship *
Volume 19, Number 10 (October 2018)
* Этот журнал не выпускается в Первом экономическом издательстве
Abstract:
Effective counteraction to the upward price dynamics in the national economy is a prerequisite for ensuring sustainable economic growth and improving the welfare of households. In modern conditions, the most common form of monetary policy aimed at regulating price dynamics is inflation targeting. The main instrument of this policy is the short - term interest rate of the Central Bank. But restraining the price dynamics by increasing the interest rate leads to a fall in credit activity in the economy and predetermines the decline in economic growth.
The purpose of the article is to develop tools of monetary policy, which provides a reduction in price dynamics in the national economy, but does not have a negative impact on the pace of economic development.
The main result of this article is the conclusion that the increase in the short-term interest rate of the Central Bank in order to contain inflation leads to a slowdown in economic development. Therefore, the reduction of price dynamics should be based on the formation of rational expectations of economic entities regarding price dynamics on the basis of their information about the full range of measures that can be applied by the Central Bank in the current macroeconomic conditions to restrain price growth.
The analysis of conceptual and practical aspects of inflation targeting is of interest to macroeconomic policy makers, financial analysts, private and institutional investors.
Keywords: inflation, interest rate, inflation targeting, exchange rate, inflation expectations
JEL-classification: E31, F31, E37, E32
References:
Bernanke B. (2004). Inflation targeting Federal reserve bank of St. Luis Review. 165-168.
Bruno M., Easterly W. (1998). Inflation crises and longrun growth Journal of Monetary Economics. 41 (1). 3-26.
Burlachkov V.K. (2012). Koordinatsiya byudzhetnoy i denezhno-kreditnoy politiki: opyt veduschikh stran i ego ispolzovanie v Rossii [Coordination of budget and monetary policy: experience of leading countries and its use in Russia]. Vestnik of the Plekhanov Russian University of Economics. (10(52)). 20-26. (in Russian).
Burlachkov V.K. (2012). Reforma mirovoy valyutnoy sistemy i primenenie ekonomicheskogo invarianta [Reform of the world monetary system and application of the economic invariant]. Voprosy Ekonomiki. (1). 151-154. (in Russian).
Eggoh J. C., Khan M. (2014). On the nonlinear relationship between inflation and economic growth Research in Economics. 68 (2). 133-143.
El-Erian M. Farewell to inflation targetingProject Syndicate. Retrieved July 02, 2018, from http://www.project-syndicate.org
Kartaev F.S. (2017). Uvelichivaet li upravlenie valyutnym kursom effektivnost inflyatsionnogo targetirovaniya? [Does Exchange Rate Management Improve Inflation Targeting?]. Money and Credit. (2). 63-68. (in Russian).
King M. The inflation target five years onBankofengland. Retrieved July 02, 2018, from https://www.bankofengland.co.uk/publications
Korischenko K., Pilnik N. (2017). O predelakh vozmozhnosti inflyatsionnogo targetirovaniya [On the limits of the possibility of inflation targeting]. Voprosy Ekonomiki. (10). 71-87. (in Russian).
Kremer S., Bick A., Nautz D. (2013). Inflation and Growth: New Evidence from a Dynamic Panel Threshold Analysis Empirical Economics. 44 (2). 861-878.
Kurihara V. (2013). Does adoption of inflation targeting reduce exchange rate volatility and ehhance economic growth Journal of world economic research. 2 (6). 104-109.
Moiseev S. (2017). Odisseya inflyatsionnogo targetirovaniya: k novym vyzovam denezhno-kreditnoy politiki [The odyssey of inflation targeting: To new challenges of monetary policy]. Voprosy Ekonomiki. (10). 50-70. (in Russian).
Mollick A., Cabral R., Carneiro F. (2011). Does inflation targeting matter for output growth? Evidence from industrial and emerging economies Journal of policy modelling. (4). 537-551.
Pourroy M. (2012). Does exchange rate control improve inflation targeting in emerging economies? Economic letters. 116 (3). 448-450.
Svensson L. (1997). Inflation forecast targeting: implementation and monitoring inflation targets European Economic Review. 41 (6). 1111-1146.
Svensson L. (1999). Price-level targeting versus inflation targeting: a free lunch? Journal of Money, Credit and Banking. 31 (3-1). 277-295.
Trunin P.V., Bozhechkova A.V., Kiyutsevskaya A.I. (2015). O chem govorit mirovoy opyt inflyatsionnogo targetirovaniya [Inflation Targeting: What Does the World Experience Say]. Money and Credit. (4). 61-67. (in Russian).
Vudfort M. (2017). Targetirovanie inflyatsii: sovershenstvovat, a ne spisyvat v util [Inflation Targeting: Fix It, Don’t Scrap It]. Voprosy Ekonomiki. (10). 45-55. (in Russian).
Walsh C. (2009). Inflation targeting: what we learned? International Finance. 12 195-233.
Woodford M. (2000). Pitfall of forward-looking monetary policy American Economic Review. 90 (2). 100-104.
Страница обновлена: 21.05.2025 в 20:29:16