The subject of central bank communication has received growing attention in recent years, at the same time as central banks themselves have increased their efforts at communicating with the public. One reason for these trends has been the strengthening of central bank independence, which has brought with it a corresponding focus on public accountability. Another factor has been an increasing re...

DoCBInstitutionsMatter.pdf, section 8.5 of Monetary Theory and Policy, 2 ed., MIT Press, 2003.This material was eliminated from the third edition of Monetary Theory and Policy. See References2e.pdf for the bibliographic information on the literature cited in this document. Both the academic literature on discretionary policy and the policy discussions surrounding the design of new policy-making...

On the macro-economic policy side of Central Banking a remarkable consensus has been emerging over the last two decades. This covers both the applicable theoretical framework for analysing the transmission mechanism of monetary policy and also the appropriate institutional structure for the Central Bank to deploy its macro-economic policies. The consensus about the latter structure generally in...

The implementation of explicit quantitative in°ation targets elucidates the assessment of credibility of future monetary policy. Here the explicit in°ation target is time-varying and stochastic with asymmetric information. It is shown that central bank independence promotes lower in°ation but not at the cost of increased output variability. Marked political instability and instrument dependence...

This paper develops a dynamic model of Rational Partisan Business Cycles, wherein wage contracts overlap elections and wage setters have to make a prediction about the election result. Uncertainty leads to preand post-election date output fluctuations. Election result probabilities are imputed and then used to construct variables in electoral uncertainty. Using data from 20 OECD countries over ...

This paper examines the relation between granting central banks more independence represented in both its manifested legal charter as well actual practices adopted and inflation Egypt during period from 1998-2019. To do so, this first looks at evolution of different bank (CBI) measures adopts most comprehensive relevant one. Consequently, it runs a regression model adopting an autoregressive di...

This paper argues that the Bank of Japan shrank from doing the right thing because it required the adoption of unconventional policies that might lose the Bank its newly acquired independence. Taka Ito frankly recognises that this argument has a problem: the Bank of Japan adopted two and a half of the recommended unconventional policies: increasing excess reserves, buying government bonds and b...