The Unassuming Economist

From a paper by Claudio Borio and Matthieu Chavaz:

“Recent and upcoming reviews of monetary policy frameworks have been putting the spotlight on
the evolution of inflation targeting. This article provides context by using a new database of
changes to the inflation targeting frameworks of 26 central banks since 1990. We use the data
to track changes in the frameworks’ flexibility in terms of the specification of the inflation target
and the role of other objectives, ie employment (or output) and financial stability. While the
specification of the numerical targets has become stricter (eg points rather than ranges), greater
flexibility has taken the form of less strict / longer horizons to achieve them and more weight on
other objectives, especially employment/output. These trends are typically more pronounced in
advanced economies and have widened differences with their emerging market peers.”