How does inflation targeting help reduce the time-inconsistency problem of discretionary policy?
Question
Solution 1
Inflation targeting can help reduce the time-inconsistency problem of discretionary policy in several ways:
- Clear Objective: Inflation targeting provides a clear, measurable objective for monetary policy. This reduces the temptation for policymakers to pursue short-term goals that may be inconsi Knowee AI is a powerful AI-powered study tool designed to help you to solve study problem.
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