Monetary Policy Neglect and the Great Inflation in Canada, Australia, and New Zealand
Edward Nelson
International Journal of Central Banking, 2005, vol. 1, issue 1
Abstract:
This paper studies the Great Inflation in Canada, Australia, and New Zealand. Newspaper coverage and policymakers’ statements are used to analyze the views on the inflation process that led to the 1970s macroeconomic policies, and the different movement in each country away from 1970s views. I argue that to understand the course of policy in each country, it is crucial to use the monetary policy neglect hypothesis, which claims that the Great Inflation occurred because policymakers delegated inflation control to nonmonetary devices. This hypothesis helps explain why, unlike Canada, Australia and New Zealand continued to suffer high inflation in the mid-1980s. The delayed disinflation in these countries reflected the continuing importance accorded to nonmonetary views of inflation.
JEL-codes: E31 E52 E58 E64 (search for similar items in EconPapers)
Date: 2005
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Related works:
Working Paper: Monetary Policy Neglect and the Great Inflation in Canada, Australia, and New Zealand (2005) 
Working Paper: Monetary policy neglect and the Great Inflation in Canada, Australia, and New Zealand (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ijc:ijcjou:y:2005:q:2:a:4
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