Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 31, 2022 erstellt
Beschreibung:
This paper considers the performance of average inflation targeting (AIT) policy when there is imperfect knowledge. There are concerns regarding robustness of AIT in a New Keynesian model with learning agents. The target steady state may not be robustly stable under adaptive learning if the length of the averaging window is not public knowledge. Near the low steady state with interest rates at the zero lower bound, AIT does not outperform standard inflation targeting policy. Policymakers can improve outcomes under AIT by (i) communicating the averaging window, or (ii) using an asymmetric rule that responds aggressively to below-target average inflation