Working Paper: NBER ID: w10954
Authors: Assaf Razin
Abstract: The note analyzes how globalization forces induce monetary authorities, guided in their policies by the welfare criterion of a representative household, to put greater emphasis on reducing the inflation rate than on narrowing the output gaps.
Keywords: Globalization; Disinflation; Monetary Policy
JEL Codes: E5; F3
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| globalization (F60) | monetary authority prioritization of inflation reduction (E63) |
| monetary authority prioritization of inflation reduction (E63) | larger output gaps (E23) |
| globalization (F60) | larger output gaps (E23) |