Monetary Policy and Financial Stability: The Role of Inflation Targeting

dc.contributor.author Sethi, Dinabandhu
dc.contributor.author Acharya, Debashis
dc.date.accessioned 2022-03-27T02:10:16Z
dc.date.available 2022-03-27T02:10:16Z
dc.date.issued 2020-03-01
dc.description.abstract This article examines the relationship between Inflation targeting (IT) and financial instability from 1990 to 2015 for Asian economies. To measure financial instability, a multidimensional financial conditioning index is calculated following the ECB's approach. Using a fixed effects panel data model the study finds that adoption of IT policy in Asian economies has an adverse impact on financial stability, thus rejecting the ‘conventional wisdom’ hypothesis. Further, the Vector Autoregression (VAR) result shows that an IT regime increases housing returns and encourages investors to take higher risks.
dc.identifier.citation Australian Economic Review. v.53(1)
dc.identifier.issn 00049018
dc.identifier.uri 10.1111/1467-8462.12348
dc.identifier.uri https://onlinelibrary.wiley.com/doi/10.1111/1467-8462.12348
dc.identifier.uri https://dspace.uohyd.ac.in/handle/1/4884
dc.title Monetary Policy and Financial Stability: The Role of Inflation Targeting
dc.type Journal. Article
dspace.entity.type
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