Suppose you were given the following information about two inflation–targeting economies.

– Economy A has been volatile historically with the unemployment rate fluctuating widely around the natural rate, with the neutral real interest rate estimated to be around 1.5 percent. Despite the economic volatility, the well-designed central bank has enjoyed many decades of credibility.

– Economy B has seen unemployment rates stay relatively close to the natural rate, with the neutral real interest rate estimated to be around 3 percent.

Despite the stable unemployment rate, the credibility of the central bank is somewhat fragile.

Based on this information, assuming everything else equal, which Economy should adopt a higher inflation target? Explain your answer.