Stern and Miller on inflation targeting

I'm catching up on a stack of journals and papers during spring break. This is from the Minneapolis Fed Quarterly Review. Given this blog's occasional updates on the inflation targeting debate, I thought it was appropriate. Stern and Miller argue in favor of inflation targeting.

The last two sentences:

The important practical step in adopting an inflation targeting strategy is to find a small set of observable variables that bear a stable long-term relationship with inflation. We believe this is an important issue for research.

Money growth (assuming constant velocity) and....?

They reject constant money growth rules in the paper as giving "too little weight to output stabilization to satisfy many government officials or the public." They also make an exception to an inflation targeting rule in the case of coordination failures, which begs the question of how to recognize a coordination failure when you're in one. I don't think that's a trivial question.

But it is a thought provoking short paper.