01894cas a2200265 a 4500 AALejournalIMF001738 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451858105 1018-5941 BD-DhAAL BD-DhAAL Wong, Chorng-Huey. Inflation Targeting and the Unemployment-Inflation Trade-off / Chorng-Huey Wong, Eric Clifton, Gene Leon. Washington, D.C. : International Monetary Fund, 2001. 1 online resource (43 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper examines the impact of the introduction of inflation targeting on the unemployment-inflation trade-off in OECD countries. Theoretical models suggest that the credibility-enhancing effects of the adoption of inflation targeting should cause an improvement in the unemployment-inflation trade-off, id est, that reducing inflation by a given amount should occur with a smaller rise in unemployment. The empirical evidence examined for OECD countries adopting inflation targeting supports this hypothesis. Using a smooth transition regression model, it is shown that the improvement in this trade-off does not take place immediately after the adoption of inflation targeting; rather, it improves over time as the credibility of the central bank is established. Mode of access: Internet Clifton, Eric. Leon, Gene. IMF Working Papers; Working Paper ; No. 2001/166 Full text available on IMF http://elibrary.imf.org/view/journals/001/2001/166/001.2001.issue-166-en.xml IMF e-Library