Most of the debate among monetary economists focused at the time on the predominant source of “the Great Moderation” among three main candidates: (1) better macroeconomic policies, (2) structural changes in the economies, and (3) less disruptive distributions of shocks (“good luck”).
The new policy framework consists of two major components: the first is "yield curve control" in which the Bank will control short-term and long-term interest rates; and the second is an "inflation-overshooting commitment" in which the Bank commits itself to expanding the monetary base until the year-on-year rate of increase in the observed consumer price index exceeds the price stability target of 2 percent and stays above the target in a stable manner.