Tom Clougherty is managing editor at the Reason Foundation, a libertarian think tank with offices in Los Angeles and Washington, DC. Previously, he was executive director of the Adam Smith Institute.
The Adam Smith Institute’s latest report, The Case for NGDP Targeting by US economist Scott Sumner, argues that that the Bank of England’s inflation targeting regime was proved inadequate by the Great Recession, and should be replaced. Instead of targeting inflation, the Bank of England should target nominal gross domestic product (NGDP). This is sometimes referred to as nominal income targeting.
