The Inflation-Targeting Debate.

• Position: Bureau Books - Book Review

The Inflation-Targeting Debate, edited by Ben S. Bernanke and Michael Woodford, is available from the University of Chicago Press for $85.00.

Over the past fifteen years, a significant number of industrialized and middle income countries have adopted inflation targeting as a framework for monetary policymaking. As the name suggests, in such regimes the central bank is responsible for achieving a publicly announced target for the inflation rate. While the objective of controlling inflation enjoys wide support among both academic experts and policymakers, and while the countries that have followed this model generally have experienced good macroeconomic outcomes, many important questions about inflation targeting remain.

For this volume, the result of an NBER conference, a distinguished group of contributors explore the many under-examined dimensions of inflation targeting--its potential, its successes, and its limitations--from both a theoretical and an...