Inflation Target and its Impact on Macroeconomy in the Zero Lower Bound Environment: the case of the Czech economy
The result's identifiers
Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216224%3A14560%2F16%3A00089654" target="_blank" >RIV/00216224:14560/16:00089654 - isvavai.cz</a>
Result on the web
<a href="http://dx.doi.org/10.1515/revecp-2016-0001" target="_blank" >http://dx.doi.org/10.1515/revecp-2016-0001</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.1515/revecp-2016-0001" target="_blank" >10.1515/revecp-2016-0001</a>
Alternative languages
Result language
angličtina
Original language name
Inflation Target and its Impact on Macroeconomy in the Zero Lower Bound Environment: the case of the Czech economy
Original language description
This paper uses a stochastic simulation of a DSGE model of the Czech economy to study the macroeconomic consequences of inflation target setting when interest rates are constrained by the zero lower bound. The distortions of this constraint depend non-linearly on the inflation target. For an inflation target of two percent the costs are negligible, but they increase steeply with lower target values. The largest impact is on the average values of output, consumption and investment; inflation is only slightly influenced. The volatility of all the variables considered increases significantly, but only for inflation targets that are close to zero. An inflation target of four percent does not bring additional benefits either in terms of low-er volatility or in terms of higher average values.
Czech name
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Czech description
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Classification
Type
J<sub>imp</sub> - Article in a specialist periodical, which is included in the Web of Science database
CEP classification
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OECD FORD branch
50200 - Economics and Business
Result continuities
Project
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Continuities
S - Specificky vyzkum na vysokych skolach
Others
Publication year
2016
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů
Data specific for result type
Name of the periodical
Národohospodářský obzor – Review of Economic Perspectives
ISSN
1213-2446
e-ISSN
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Volume of the periodical
16
Issue of the periodical within the volume
1
Country of publishing house
CZ - CZECH REPUBLIC
Number of pages
14
Pages from-to
3-16
UT code for WoS article
000406944500001
EID of the result in the Scopus database
2-s2.0-84962659717