Journal Article

Price stability: is a tough central bank enough?


Abstract: What is the best way to achieve price stability? Conventional wisdom says that a tough, independent central bank is all that is necessary. However, a new view?the fiscal theory of the price level?argues that an appropriate fiscal policy is also required, no matter how tough the central bank may be. The choice of the fiscal theory versus the conventional view has significant implications for the way central banks do business.

Keywords: Monetary policy; Fiscal policy; Banks and banking, Central;

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Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Economic Commentary

Publication Date: 2000

Issue: Aug

Order Number: 1