Inflation Targeting and Fiscal Rules Do Interactions and Sequencing Matter?

The paper examines the joint impact of inflation targeting (IT) and fiscal rules (FR) on fiscal behavior and inflation in a broad panel of advanced and developing economies over the period 1990-2009. The main contribution of the paper is to show that, as suggested by the theoretical literature, inte...

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Bibliographic Details
Main Author: Combes, Jean-Louis
Other Authors: Debrun, Xavier, Minea, Alexandru, Tapsoba, Rene
Format: eBook
Language:English
Published: Washington, D.C. International Monetary Fund 2014
Series:IMF Working Papers
Subjects:
Online Access:
Collection: International Monetary Fund - Collection details see MPG.ReNa
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245 0 0 |a Inflation Targeting and Fiscal Rules  |b Do Interactions and Sequencing Matter?  |c Jean-Louis Combes, Xavier Debrun, Alexandru Minea, Rene Tapsoba 
260 |a Washington, D.C.  |b International Monetary Fund  |c 2014 
300 |a 36 pages 
651 4 |a Poland, Republic of 
653 |a Fiscal stance 
653 |a Treasury Policy 
653 |a Inflation 
653 |a Comparative or Joint Analysis of Fiscal and Monetary Policy 
653 |a Stabilization 
653 |a Fiscal rules 
653 |a Monetary economics 
653 |a Inflation targeting 
653 |a Deflation 
653 |a National Deficit Surplus 
653 |a Fiscal Policy 
653 |a Fiscal policy 
653 |a Price Level 
653 |a Prices 
653 |a Macroeconomics 
653 |a Monetary policy 
653 |a Central Banks and Their Policies 
653 |a Public Finance 
653 |a Monetary Policy 
653 |a Money and Monetary Policy 
700 1 |a Debrun, Xavier 
700 1 |a Minea, Alexandru 
700 1 |a Tapsoba, Rene 
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520 |a The paper examines the joint impact of inflation targeting (IT) and fiscal rules (FR) on fiscal behavior and inflation in a broad panel of advanced and developing economies over the period 1990-2009. The main contribution of the paper is to show that, as suggested by the theoretical literature, interactions between FR and IT matter a great deal for policy outcomes. Specifically, the combination of FR and IT appears to deliver more disciplined macroeconomic policies than each of these institutions in isolation. In addition, the sequencing of the monetary and fiscal reforms plays a role: adopting FR before IT delivers stronger results than the reverse sequence