Average Inflation Targeting with Dual Mandate

The Fed recently adopted average inflation targeting (AIT). Under AIT the Fed aims to achieve an inflation rate that is, on average, equal to their 2 percent long-term target. This would allow the Fed to overshoot its long-term inflation target after it was hit by a sequence of contractionary shocks that created economic slack and inflation below the long-term target (e.g. GFC and Covid-related shocks). 

 

Should other central banks adopt AIT? Many Central bankers will be watching how well AIT works in the US.  Kostanyan and Laxton (2020) make the case that advanced inflation-targeting central banks like Canada should definitely consider this and The Better Policy Project provides a course on the benefits as well as an analytical framework to support an AIT regime. The modeling framework will be initially available in Dynare/Matlab and is being developed in open source software (Dynare/Julia). The latter will increase the potential for even higher levels of central-bank transparency as it will be much easier to replicate central bank forecasts and risk assessments.

This course will last 4 weeks. Participants will be expected to work full time but will have access to 2 hours of training each working day. The courses are organized to focus on the needs of each central bank. Class sizes are limited to 1-5 participants. There are significant discounts for central banks from low-income countries and for CBs that enroll more than 4 participants through the year. 

 

Prerequisites

This online course is designed for people working in central banks. The participants need to:

  • Have at least intermediate knowledge in statistics and macroeconomics.

  • MATLAB 2017a or later versions. 

  • Latest version of Dynare (4.6.2).

  • Being an intermediate user of Dynare/Matlab would be an asset but no previous knowledge of it is required as there will be a special mini-course for beginners.

 
 
 
 

Dates for 2021 - 2022

Duration - 4 Weeks, 2 Hours Per Day

May 2 - 27, 2022

June 1 - 28, 2022

July 4 - 29, 2022

August 1 - 26, 2022

September 1 - 28, 2022

October 3 - 28, 2022

November 1 - 28, 2022

Course Structure

Week 1

Hands-on work with Canada model

Week 2

Prepare a version for another country

Week 3

Prepare presentation

Week 4

Document model results in working paper

 

Price

Price for One Person Without any Discounts is €3000

This course will last 4 weeks. Participants will be expected to work full time but will have access to 2 hours of training each working day. The courses are organized to focus on the needs of each central bank. Class sizes are limited to 1-5 participants. There are significant discounts for central banks from low-income countries and for CBs that enroll more than 4 participants through the year.