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The purpose of this paper is to examine the impact of inflation targeting on inflation for 27 countries that have adopted an inflation‐targeting regime.

The paper uses intervention analysis in Harvey's structural time series model to analyse the impact of inflation targeting on inflation, using quarterly observations. This approach provides the most useful framework for separating changes that occur to a series ordinarily over time from those happening due to exogenous events identified a priori, such as inflation targeting.

The empirical evidence suggests that almost all of the central banks that have pursued this strategy have been unsuccessful at controlling inflation, with the results indicating that the adoption of an inflation‐targeting regime has had the perverse effect on inflation for almost every country.

The implication of the finding is that central banks which have adopted an inflation‐targeting regime do not appear to have been particularly successful in reducing inflation in any significant way, as is regularly claimed in the extant literature.

The paper provides further evidence against the adoption of an inflation‐targeting regime using an unconventional approach for 27 countries that are regarded as “fully‐fledged” inflation‐targeting countries.

The purpose of this paper is to test the hypothesis of long‐run money neutrality for Egypt, Jordan and Morocco using seasonal cointegration techniques.

The paper uses seasonal integration and cointegration techniques to test the neutrality of money hypothesis for three Middle Eastern economies, using quarterly data on money, prices and real income. The benefit of using this technique lies in its ability to distinguish between cointegration at different frequencies.

The empirical results show that money is cointegrated with prices, but not with output at the zero frequency for Egypt, Jordan and Morocco. This suggests that money affects nominal but not real variables in the long run, implying that money is neutral in these three Middle Eastern economies.

The implication of this finding for policy analysis suggests that the anti‐inflationary policy prescription espoused by the monetarist school should be followed in these three Middle Eastern countries, in order to curb inflation.

The paper provides further evidence in support of money neutrality using an unconventional approach for three developing Middle Eastern economies.

The purpose of this paper is to analyse the cyclical relationship between the demand for crude oil and real output for the OECD.

The paper employs Harvey's structural time series model to analyse the contemporaneous and non-contemporaneous cyclical co-movement of the demand for crude oil with real output, using quarterly observations for the period 1984:1-2010:4.

The empirical evidence suggests that a strong and positive cyclical relationship between the two variables exists, with the demand for crude oil being procyclically contemporaneous.

The implication of this finding suggests that consuming countries cannot stockpile oil reserves to guard against the cyclical nature of demand, while producing countries face weak and bearish oil markets during economic recessions, because oil consuming countries cannot smooth out their demand for oil on an intertemporal basis.

The paper provides further evidence supporting the procyclically contemporaneous relationship between the demand for crude oil and real output for the OECD.