From Volcker to Volcker: IMF Monetary Policy Doctrine and Practice.

How did the International Monetary Fund (IMF)’s monetary policy change between the Great Moderation and the transformative processes that followed the Great Recession? This chapter suggests that monetarism inspired some of the Fund’s monetary policy thinking during the Great Moderation. During the 2000s, the intellectual bases of this orthodox monetary policy became eroded, with the Great Recession pushing for revisions in the entire macro-financial framework. The pandemic reinforced this revisionism but the inflationary crisis of 2022 seems to have brought about a return to monetary orthodoxy. Key to all these transformations has been the Fund’s strategy to highlight both continuity and change while reserving the jurisdiction to define the resolution of the policy trade-offs that emerge along the way.