ughout the world. But, in Canada, as in most of Europe, the waiting continues. This is not to suggest that the waiting game has been silent and entirely pleasant. Indeed, the relative lack (or lag!) of success of zero inflation policies and strict price controls has spurred much heated debate. As a case in point, more people are curious why Canada has exclusively focused on inflation cutting and turned a blind eye to the more balanced, and arguably more successful, approach adopted by the U.S.. Is it actually desirable, or wise, to aim towards virtual price stability? Are there real long-term benefits to low, or zero, inflation? What are the real effects of low inflation? The intensity of the ongoing debate on these issues provides evidence that there are no straightforward answers. The purpose of this paper is to probe at these issues in an attempt to cast some clarity on the debate. Appropriately, it begins with an analysis of the consequences of low inflation on the conduct of monetary policy. As is well known, these effects are controvers
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