Are there institutional or political precautions to control inflation sustainably, together with an appropriate monetary policy and fiscal policy? A one means that there is no anti-inflation policy, foreign exchange rates are manipulated for political gain, and there are no fiscal or debt policies to promote macroeconomic stability. A ten means that inflation and foreign exchange policies are integrated and institutionalized under an independent central bank and the government’s debt and fiscal policies promote macroeconomic stability.
Source: Bertelsmann Transformation Index