Abstract
The notion of ‘a framework for monetary stability’ — the title of this conference — immediately implies the desirability of maintaining steady growth, or under some circumstances even a steady level, of money however defined. This presumption is consistent with the recent practice of a number of central banks, and with the rhetoric of many more. For more than two decades, target growth rates for one or another measure of money have often played a key role in the formulation and implementation of monetary policy. European central banks, including in particular the Bundesbank, have been especially prominent in this regard.
I am grateful to Ben Broadbent for research assistance, and to the G.E. Foundation and the Harvard Program for Financial Research for research support. Parts of the paper draw on my recent work, including Friedman (1990, 1993) and Friedman and Kuttner (1992).
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Friedman, B.M. (1994). Intermediate Targets versus Information Variables as Operating Guides for Monetary Policy. In: De Beaufort Wijnholds, J.O., Eijffinger, S.C.W., Hoogduin, L.H. (eds) A Framework for Monetary Stability. Financial and Monetary Policy Studies, vol 27. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-0850-8_11
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