ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Can Central Banks Reduce Inflation?

Evidence from 158 Countries

Can Central Banks Reduce Inflation?

To explore the empirical validity of the proposition that a rise in the interest rate would necessarily lead to a lower rate of inflation, empirical evidence from 158 countries, during 1981 to 2013, is used to critically evaluate this widely accepted idea. Based on the findings, it is argued that from a policy perspective, the so-called “inflation targeting” should be revisited.

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Updated On : 2nd Apr, 2018

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