The Great Inflation: The Rebirth of Modern Central Banking (National Bureau of Economic Research Conference Report)

Controlling inflation is among the most important objectives of economic policy. By maintaining price stability, policy makers are able to reduce uncertainty, improve price-monitoring mechanisms, and facilitate more efficient planning and allocation of resources, thereby raising productivity. This volume focuses on understanding the causes of the Great Inflation of the 1970s and ’80s, which saw rising inflation in many nations, and which propelled interest rates across the developing world into the double digits. In the decades since, the immediate cause of the period’s rise in inflation has been the subject of considerable debate. Among the areas of contention are the role of monetary policy in driving inflation and the implications this had both for policy design and for evaluating the performance of those who set the policy. Here, contributors map monetary policy from the 1960s to the present, shedding light on the ways in which the lessons of the Great Inflation were absorbed and applied to today’s global and increasingly complex economic environment. Controlling Inflation Is Among The Most Important Objectives Of Economic Policy. By Maintaining Price Stability, Policy Makers Are Able To Reduce Uncertainty, Improve Price-monitoring Mechanisms & Facilitate More Efficient Planning & Allocation Of Resources. This Volume Focuses On Understanding The Causes Of The Great Inflation Of The 1970s & 1980s. Introduction / Michael D. Bordo And Athanasios Orphanides -- Practical Experiences In Reducing Inflation : The Case Of New Zealand / Don Brash -- Practical Experiences In Reducing Inflation : The Case Of Canada / John Crow -- The Great Inflation : Did The Shadow Know Better? / William Poole, Robert H. Rasche, And David C. Wheelock -- Comment / Christina D. Romer -- The Supply-shock Explanation Of The Great Stagflation Revisited / Alan S. Blinder And Jeremy B. Rudd -- The Great Inflation Drift / Marvin Goodfriend And Robert G. King -- Comment / Lars E.o. Svensson -- Falling Behind The Curve : A Positive Analysis Of Stop-start Monetary Policies And The Great Inflation / Andrew Levin And John B. Taylor -- Comment / Bennett T. Mccallum -- Monetary Policy Mistakes And The Evolution Of Inflation Expectations / Athanasios Orphanides And John C. Williams -- Comment / Seppo Honkapohja -- Opting Out Of The Great Inflation : German Monetary Policy After The Breakdown Of Bretton Woods / Andreas Beyer, Vitor Gaspar, Christina Gerberding, And Otmar Issing -- Comment / Benjamin M. Friedman -- Great Inflation And Central Bank Independence / Takatoshi Ito -- Comment / Frederic S. Mishkin -- The Great Inflation In The United States And The United Kingdom : Reconciling Policy Decisions And Data Outcomes / Riccardo Dicecio And Edward Nelson -- Comment / Matthew D. Shapiro -- Bretton Woods And The Great Inflation / Michael D. Bordo And Berry Eichengreen -- Comment / Allan H. Meltzer -- Lessons From History / Donald L. Kohn -- The Great Inflation : Lessons For Central Banks / Lucas Papademos -- Understanding Inflation : Lessons Of The Past For The Future / Harold James. Edited By Michael D. Bordo And Athanasios Orphanides. Includes Bibliographical References And Indexes.