A credible commitment to more inflation means that the expected return from a safe bond is lower in real terms.
But the researchers also reckon that strong monetary easing combined with a credible commitment to an inflation target would have been sufficient to negate the effect of ageing.
As high unemployment continues, more and more people, including top economists, are asking the Fed to promise a credible commitment to a more expansionary monetary policy.
But his proposal to freeze nonsecurity discretionary spending, starting next year, is a credible commitment to find more serious savings once the economy rebounds.
There won't be a credible commitment to see the monetary stimulus through, as people panic that resulting inflation will be used to redistribute wealth.
If central banks can make a credible commitment to keep rates in the future down, the expected payment on floating-rate mortgages and car loans will drop.
"Without fiscal discipline and a credible commitment to eliminate the deficit, we cannot achieve the stability we need.
This paper investigates the design and impact of ARAs in Latin America, arguing that politicians create ARAs in order to signal a credible commitment to taxpayers that tax administration will be more effective, fair, and competent.
In case D, the optimal governmental choice can be interpreted as an example of the so-called "Lean and Hungry Look": By choosing a private duopoly, the government makes a credible commitment to "underinvest" in advertising (which hurts its rival).
These nominally democratic institutions embedded in authoritarian regimes arguably serve to impose self-constraint on the rulers and constitute a credible commitment to prospective investors and taxpayers, ultimately boosting economic growth (Gandhi 2008; Gehlbach and Keefer 2011; Wright 2008).
