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Abstract

Female Central Bank chairs represent but a tiny minority. To understand why, this article analyzes socio-economic and socio-political characteristics of the countries where women have chaired Central Banks. Then, it suggests that gender differences in preferences as regards monetary policy goals may have some influence. This hypothesis is based on an empirical analysis showing that female Central Bank chairs focus more than their male counterparts on achieving the price stability goal. This means, then, that women are more resistant than men to political pressures. Finally, it concludes that gender differences in degree of conservatism may be an explanatory factor in female underrepresentation in the Central Bank chairs.

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... Regardless of the factors that influence monetary policy (such as financial liberalization), it is likely to have gender-differentiated effects on employment, consumption, and children's well-being with resulting feedback effects on growth. Only a handful of papers have explored the impact of contractionary monetary policy on gendered outcomes (Braunstein and Heintz 2008;Takhtamanova and Sierminska 2009;Seguino and Heintz 2012), while two papers explore the relationship between gender representation on monetary policy committees and the conduct of monetary policy (Diouf and Pépin 2016;Masciandaro, Profeta, and Romelli 2016). Braunstein and Heintz (2008), pioneers in this research, found that after controlling for long-term employment trends, the ratio of women's to men's employment tends to decline during contractionary inflation reduction in the majority of the developing countries examined. ...
... In terms of the conduct of monetary policy, Diouf and Pépin (2016) and Masciandaro, Profeta, and Romelli (2016) provide evidence that gender diversity in central bank boards and chairs affects the conduct of monetary policy and hence macroeconomic outcomes. Greater relative women's representation on central bank boards is inversely associated with inflation rates and money growth. ...
... Greater relative women's representation on central bank boards is inversely associated with inflation rates and money growth. Diouf and Pépin (2016) suggest that because women central bankers are more concerned with price stability than their male counterparts, they are (a) more resistant than men to political pressures, and (b) this could explain the underrepresentation of women as central bank chairs. These papers inform about the role of gender in shaping key macroeconomic institutions. ...
Article
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Over the past two decades, economists have turned their attention to exploring the role of gender in the macroeconomy. This paper reviews the salient findings of that literature. Research shows that gender gaps in education, health, unpaid labor, employment, and wages have economy-wide consequences and influence the rate of growth. The effects are transmitted via both the supply side of the economy – principally through labor productivity – and the demand side – through business spending, exports, saving, and the balance of payments. In turn, a broad array of macro-level policies, including fiscal, monetary, and trade policies have differential effects by gender that, if unheeded, can undermine macro-policy goals. Their impact depends on the structure of the economy and the gender division of labor in paid and unpaid work. This survey makes clear that incorporation of gender into macro models improves the relevance of macroeconomic theory and can yield better policy results.
... Regardless of factors influencing monetary policy, such as financial liberalization, there are likely to be gender-differentiated effects on employment, consumption, and children's wellbeing with resulting feedback effects on growth. Only a handful of papers have explored the impact of contractionary monetary policy on gendered outcomes (Braunstein and Heintz 2006;Tachtamanova and Sierminska 2009;Seguino and Heintz 2012) while two papers explore the relationship between gender representation on monetary policy committees and the conduct of monetary policy (Diouf and Pépin 2016;Masciandaro, Profeta, and Romelli 2016). Braunstein and Heintz (2006) were pioneers in this research. ...
... In terms of the conduct of monetary policy, Diouf and Pépin (2016) and Masciandaro, Profeta, and Romelli (2016) find evidence that gender diversity in central bank boards and chairs affects the conduct of monetary policy and hence macroeconomic outcomes. Greater relative female representation on central bank boards is inversely associated with inflation rates and money growth. ...
... Greater relative female representation on central bank boards is inversely associated with inflation rates and money growth. Diouf and Pépin (2016) suggest that because women central bankers are more concerned with price stability than their male counterparts, they are a) more resistant than men to political pressures, and b) this could explain the underrepresentation of women as central bank chairs. These papers add to our knowledge of the role of gender in shaping key macroeconomic institutions. ...
... They arrive at these conclusions by introducing the first index to evaluate gender representation as well as the extent to which legal, religious, historical, and socioeconomic factors are catalysts in monetary policy-making for 112 countries. Diouf and Pépin (2017) reaches the same conclusion, investigating the socioeconomic and sociopolitical characteristics of the countries where women have chaired Central Banks, for the period from 1949 until 2014. They find evidence that female chairs focus more than their male counterparts on achieving price stability goals. ...
... To understand how gender affects the voting outcome, we run a multinomial logit model specified in Equation 1 where the results are shown in Table 2. Columns (1) and (2) show the baseline model with the ratio of women at the meeting as the only independent variable. We find that women are positively associated with both ease and tighten of monetary policy, compared to the base outcome of "stay", consistent with the results of the previous literature which show that women are more hawkish (Farvaque et al., 2010;Masciandaro et al., 2015Masciandaro et al., , 2018Diouf and Pépin, 2017), and the literature which shows that women are more dovish (Istrefi, 2018;Bordo and Istrefi, 2018). However, when we add macroeconomic controls (columns (3) and (4)), tighten is no longer significant and the effect for ease is marginally significant. ...
... While gender diversity in the boardroom is a "hot topic" in the corporate governance literature there is scant research on gender diversity in central banks. Recent studies suggest that a higher share of women in central bank boards is associated with a more hawkish approach to monetary policy (see Farvaque et al., 2011;Masciandaro et al., 2015;Diouf and Pépin, 2017). To the best of our knowledge, no studies have yet analyzed the pattern of appointments in central bank boards. ...
Article
We build a novel dataset that allows us to track appointments to central banks boards from 2003 to 2015 in 26 OECD countries. We find that female board members tend to replace each other, suggesting a systematic bias against women.
... While gender diversity in the boardroom is a ''hot topic'' in the corporate governance literature there is scant research on gender diversity in central banks. Recent studies suggest that a higher share of women in central bank boards is associated with a more hawkish approach to monetary policy (see Farvaque et al., 2011;Masciandaro et al., 2015;Diouf and Pépin, 2017). To the best of our knowledge, no studies have yet analyzed the pattern of appointments in central bank boards. ...
Thesis
This thesis consists of three empirical papers on central bank institutional design.Chapter 1 contributes to the debate on the importance of central bank independence (CBI) in lowering inflation rates. It stresses the relevance of employing indices of central bank independence computed dynamically in two ways. First, it recomputes the evolution of the Grilli et al. (1991) index of CBI and shows that the timing of large legislative reforms is closely related to inflation rate dynamics. Using unit root tests with endogenous structural breaks, I find that reforms that modify the degree of CBI represent structural breaks in the inflation rate dynamics. Second, employing the dynamic Grilli et al. (1991) index of independence confirms the negative relationship between CBI and inflation in a sample of 10 advanced economies.Chapter 2 presents a new and comprehensive database of central bank institutional design for 65 countries over the period 1972--2014. This chapter describes in detail the sources of information and the coding rules used to create a new index of central bank independence. It also compares this new index with the classical measures of CBI and highlights the new aspects of central bank institutional design included in this database such as financial independence and accountability. An important innovation of this new index is its dynamic nature. This enables an investigation of the endogenous determination of the level of independence of central banks and suggests several instruments for the CBI index. Using an instrumental variable approach, this chapter provides strong support for a causal, negative CBI-inflation nexus.Chapter 3 uses a political economy framework to investigate the drivers of reforms in central bank institutional design. Using the new CBI index developed in Chapter 2, this Chapter investigates the determinants of central bank reforms in a sample of 65 countries over the period 1972--2014. The results obtained suggest that the incentives generated by initial reforms which increased the level of independence, as well as a regional convergence, represent important drivers of reforms in central bank design. At the same time, an external pressure to reform, such as obtaining an IMF loan or joining a monetary union, also increases the likelihood of reforms, while government changes or crises episodes have little impact.
... A recently topical, but debated since at least Chappell and McGregor (2000), determinant of policy preferences is also gender. According to a number of recent studies, women tend to have rather hawkish preferences in the "men's world" of central banking: higher share of female members are associated with lower inflation levels (Farvaque et al., 2011(Farvaque et al., , 2014 and female central bank chairs focus more than their male counterparts on achieving the price stability goal (Diouf and Pépin, 2017). 4 However, in the existing literature, either it has been searched for regional economic influences without considering background effects or, on the opposite, it has been looked at background effects without controlling for regional developments. ...
Article
This paper sheds some new light on the determinants of FOMC members’ monetary policy preferences. For that purpose, we use a new dataset of macroeconomic indicators for the Fed districts, as well as preferences revealed by FOMC members in the Transcripts, to compute a desired interest rate for each individual member. First, we find that FOMC members react to the regional unemployment rate. Second, individuals holding a Master or Bachelor degree, and issued from either the central bank, or from the private or public sector have a higher propensity to disagree on the dovish side, while women tend to disagree on the hawkish side. These findings provide further insights for central bank watchers about the upcoming policy decisions that are likely to be implemented by the FOMC, following the composition of its committee and the evolution of regional cycles.
... This conclusion is supported by the study of Masciandro et al. (2018), showing that central bank boards with a higher share of women set higher interest rates for a given level of inflation. Diouf and Pépin (2017) also conclude that women are more strongly committed than men to the objective of price stability. One again, a selection effect might be at play here: women may be appointed to these top positions only if they are highly hawkish in their orientation. ...
... With negative and positive relations with gender disparity index at a 5% significance threshold, we establish that a percentage increase in the exchange rate and inflation will lead to 0.562% decrease and 0.493% increase in gender disparity index in SSA. These results are similar to those found in Diouf and Pépin (2017); Cho (2016) could be due to undesirable exchange rate relation, which caused commodity prices to increase beyond an acceptable threshold. The uneven exchange rate and commodity price factors have consequences for a large pool of SSA women who are predominantly engaged in jobs that are classified in the informal economy. ...
Article
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The social movement is inspiring meaningful conversation about the discriminatory practices’ that Africa women have long faced in every aspect of their lives. However, despite considerable improvement in the gender balance discourse, the worst cases of gender imbalances are still recorded in sub-Sahara Africa (SSA). Macroeconomic volatility, both as a source and a reflection of underdevelopment, is a fundamental concern for women in SSA. This paper leans empirical credence to the role of macroeconomic policies (fiscal and monetary policies indices) for gender equality in SSA from 1993 through 2017. We gathered panel data on the indices of macroeconomic policies and gender inequality in all 48 SSA countries. We employed the dynamic panel system generalised method of moment estimation procedure (dynamic system GMM) to establish a baseline level relationship between the variables of interest. We adjusted for heterogeneity assumptions inherent in ordinary panel estimation and found a basis for the strict orthogonal relationship among the variables. Our results suggest fluctuations in macroeconomic policies as a lead factor for gender equality in SSA countries. Efforts should be tailored towards balanced macroeconomic policies that can guarantee sustainable gender equality approaches to collective prosperity.
... Ainsley (2019) used matching methods to show that in the FED voting and discourse while there is no evidence women vote differently from their male colleagues, monetary policy committee with one or more female members devote more discussion to employment issues and vote in line with more expansionary monetary policy stances. On the opposite site Diouf and Pepin (2019) show that female central bank chairs focus more than their male counterparts on achieving the price stability goal. Women are underrepresented in top positions in all sectors across the world. ...
... Among these 26 chairwomen, 24 were appointed after 2005 and 22 after 2008, indicating still very small and insufficient progress since the crisis. There are so far very few studies on the long-neglected question of gender diversity in central bank governance and of the factors relating to women's (under-)representation, their policy implications and macroeconomic outcomes (Diouf and Pépin 2017;Farvaque et al. 2011;Masciandaro et al. 2015). Furthermore, these quantitative studies, based on sample populations of chairwomen too small to produce generalisable findings, don't allow us to perceive the complex mechanisms of exclusion and their consequences regarding gender inequality. ...
Chapter
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This study investigates the impact of political connections on government contract success rates of publicly listed companies in Canada (2010–2014). It illustrates how public information, basic financial accounting and Two-Stages Least Squares (2SLS) estimation can be used to analyse the power plays between public authorities and large corporations. The results show that political connections are frequent among publicly listed Canadian companies. While weak, these connections are positively and significantly associated with the winning of government contracts. Our study is the first to demonstrate a direct relationship between corporate political connections and government contracts in the Canadian context. The study confirms the interdependence between politics and business, particularly the increase in the number of corporate actions intended to influence government decisions. Its robust results call for more studies on what board members with political credentials actually do, on top of securing public contracts.
... Within this framework, the "principal-agent" relation described above can be developed around the convergence of the social preferences of the central banker and the politics, focusing on a desire for price stability (Walsh, 1995): this mission provides benefits both to society and the central bankers whose ability to complete their mission in part determines their career. Specifically, since low inflation enables to preserve the value of capital and thus of the interests of banking and financial institutions, being "hawks" eases the possibility of cross-mobility that exists between careers in central banks and careers in the above institutions (Diouf & Pépin, 2017;Vallet, 2019). ...
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This paper deals with the neglected issue of central banks’ social responsibility. Since central banks exert the “structural power” on economies as well as on societies, their power should be regulated and controlled by society through a reliable framework of social responsibility. To that aim, this article sheds light on the ‘why’ and the ‘how’ of central bank’s social responsibility: I suggest reforms in order to increase central banks’ social legitimacy, while being consistent with the mapping out of a new framework of social responsibility.
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Book
By now it has become obvious that Federal Reserve actions have an immense impact on the functioning of our economy. As a result, a great deal of research has been done on the Fed and on monetary policy. Much of this work is normative; it tells us what the Fed should do. Positive work on the Fed has usually tried to elucidate particular Fed policies, and has not tried to present a theory of why the Fed behaves the way it does. The dominant theory of Fed behavior is that the Fed does what it believes to be best for the public welfare. This theory - usually left implicit - is so simple, and seemingly so obviously correct, that it has received widespread credence without extended discussion or tests. When thinking about govern­ ment in general many observers doubt that it nearly always acts in the public interest. However, they ascribe this unfortunate state of affairs mainly to political pressures. Since the Fed is relatively removed from such pressures, the public interest theory of government seems more applicable to it.
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In this paper we estimate ideal points of Bank Presidents and Board Governors at the FOMC. We use stated preferences from FOMC transcripts and estimate a hierarchical spatial voting model. We find a clear difference between the average Board Governor and Bank President. We find little evidence for difference in ideal points according to the appointing president in case of Bank Governors. Similarly career background has no clear effect on the ideal points. We find that the median ideal point at the FOMC has been fairly stable over our sample period (1989-2007) emphasizing the lack of a political appointment channel. We also show that there was considerable variation in the median ideal point of Bank Presidents and Board Governors, but that these seem to cancel each other out. Also the dispersion of opinions (the spread between the lowest and highest ideal point) varies over time, suggestion variation in agreement at the FOMC.
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This note ranks the Federal Reserves based on the tenure of their chairs from William McChesney Martin, Jr. to Janet L. Yellen, using data from 1958 through Q3 2014. Inflation “doves” are willing to tolerate more inflation than inflation “hawks.” Comparing the Taylor (1993) rule and core inflation to the effective fed funds rates, it is found that the Yellen Fed is the most dovish Fed since 1958.
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Focusing on how the President and the Senate influence monetary policy by appointing Federal Reserve Board members, this book answers three questions about the appointment process and its effects. First, do politicians influence monetary policy via Federal Reserve appointments? Second, who influences the process--only the President or the President and the Senate? Third, how is the structure of the Federal Reserve appointment process explained? The study extends the analysis of the Federal Reserve Board to the European Central bank.
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'Inflation targeting (IT) has become the sacred cow of central banking. But its suitability to developing nations remains contested. The contributors to this volume perform the valuable service of sketching out plausible, more development-friendly alternatives. They are to be commended in particular for avoiding a one-size-fits-all approach and paying close attention to the needs of specific countries. Their proposals range from relatively minor tinkering in IT to comprehensive overhaul. A common theme is the central role of the real exchange rate, which the central banks ignore at their economies' peril.' - Dani Rodrik, Harvard University, US. © Gerald A. Epstein and A. Erinç Yeldan 2009. All rights reserved.
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Inflation targeting is shown to imply inflation forecast targeting: the central bank's inflation forecast becomes an explicit intermediate target. Inflation forecast targeting simplifies both implementation and monitoring of monetary policy. The weight on output stabilization determines how quickly the inflation forecast is adjusted towards the inflation target. Money growth or exchange rate targeting is generally inferior than inflation targeting and leads to higher inflation variability. Commitment to 'target rules' may be better than commitment to 'instrument rules'.
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Analyzing university faculty and graduate student data for the top-ten U.S. economics departments between 1987 and 2007, we find that there are persistent differences in gender composition for both faculty and graduate students across institutions and that the share of female faculty and the share of women in the entering PhD class are positively correlated. We find, using instrumental variables analysis, robust evidence that this correlation is driven by the causal effect of the female faculty share on the gender composition of the entering PhD class. This result provides an explanation for persistent underrepresentation of women in economics, as well as for persistent segregation of women across academic fields.
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This paper examines the influence of the biographical experience of monetary policy committee members on their performance in managing inflation and output volatility. Our sample covers major OECD countries in the 1999 to 2010 period. Using data envelopment analysis (DEA), we study the efficiency of monetary policy committees. Then, we look at the determinants of these performances. The results in particular show that (i) a larger number of governors is more efficient, except in crisis time, (ii) a policymakers' background influence the performance, with a positive role for committee members issued from academia, central banks and the financial sector. It is also shown that some committees have reduced the inefficiency created by the crisis more rapidly than others.
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We devise and apply a method for estimating monetary policy reaction functions for individual members of the Federal Open Market Committee (FOMC) of the Federal Reserve. Our method uses members’ votes on the monetary policy directive in FOMC meetings as the key source of data on individual preferences. The analysis provides a ranking by preference for ease for 84 FOMC members who served during the 1966–1996 period.
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In many countries, monetary policy decisions are made by committees. In the United States, these decisions are made by the Federal Reserve's Federal Open Market Committee (FOMC), which consists of the seven members of the Board of Governors and the presidents of the twelve district banks. This book examines the process by which the preferences of the FOMC's individual members are translated into collective policy choices. This focus on the aggregation of individual preferences into group decisions is unique and provides an important perspective on the evolution of monetary policy choices. To study decision making by the FOMC, the authors have used both formal voting records and detailed transcripts and summaries of deliberations contained in the committee's Memoranda of Discussion and FOMC Transcripts. The latter sources have been used to construct data sets describing individual committee members' policy preferences for the 1970-1978 and 1987-1996 periods when the FOMC was chaired by Arthur Burns and Alan Greenspan, respectively. These data are used to estimate monetary policy reaction functions for individual Committee members and to explore the role of majoritarian pressures, pressures for consensus, and the power of the chairman in collective decision making. The rich anecdotal evidence found in the Memoranda of Discussion and FOMC Transcripts inspires the narrative approach taken in two chapters, on the influence of political pressure on FOMC deliberations and on the relevance of the time inconsistency problem for the rise of inflation in the 1970s.
Article
This study disentangles policy parameters from those describing private sector behavior by simultaneously estimating an empirical model for inflation and output along with a loss function for the last three Federal Reserve administrations. Three important results emerge: First, the Federal Reserve appears to put more emphasis on price stability than output stability when the entire sample is considered. Second, and more importantly, the loss function parameters exhibit structural break at the time Paul Volcker was appointed chairman. The accommodative characteristics of monetary policy were replaced with a more active policy towards controlling inflation. Finally, interest rate smoothing is found to be an important feature of the monetary policymaking process for all three administrations.
Article
We study how monetary, exchange-rate and other institutional arrangements are associated with policy makers’ preferences for inflation stability. We argue that focusing on policy intentions, represented by these preferences, constitutes a better way of evaluating policy behavior, instead of looking at inflation outcomes that may be unavoidable at times.Using a panel of 34 countries over a period of 24 years we find that a high degree of preference for inflation stability is significantly correlated only with central bank independence and membership to the European Economic and Monetary Union for low inflation countries, whereas for high inflation countries only strict inflation targeting and, to some extent, central bank independence, are relevant for inflation stabilizing policies. Finally, we find no robust evidence suggesting that either adopting an exchange rate anchor or employing fiscal policy are associated with an inflation averse behavior.
Article
The purpose of the paper is to survey and discuss inflation targeting in the context of monetary policy rules. The paper provides a general conceptual discussion of monetary policy rules, attempts to clarify the essential characteristics of inflation targeting, compares inflation targeting to monetary targeting and nominal-GDP targeting, and draws some conclusions for the monetary policy of the European System of Central Banks.
Article
Society can sometimes make itself better off by appointing a central banker who does not share the social objective function, but instead places “too large” a weight on inflation-rate stabilization relative to employment stabilization. Although having such an agent head the central bank reduces the time-consistent rate of inflation, it suboptimally raises the variance of employment when supply shocks are large. Using an envelope theorem, we show that the ideal agent places a large, but finite, weight on inflation. The analysis also provides a new framework for choosing among alternative intermediate monetary targets.
Article
Economists have frequently asserted that central bank priorities among economic goals have not been appropriate to the public’s desires. For example, one interpretation of the results of Reuber’s pioneering study of central bank preferences was that: [The Bank of Canada’s] reactions reflect the placing of a very heavy implicit weight on price stability compared with higher employment, presumably based on a judgement about the relative economic costs of more unemployment and more price inflation. The evidence examined on the relative economic costs of price inflation and unemployment suggests that the economic costs of inflation are not as high relative to the costs of unemployment as the reactions and statements of the authorities have implied. [Reuber, p. 132](1) Relatedly, economists have claimed that central banks have placed an undue emphasis on the state of government security markets. The Bank of England, in particular, has been criticized in this vein.(2) Despite the well documented problems in defining social preferences, an implication of such statements is that central bank’s preferences differ from the public’s priorities. Except for vague statements about the inherent conservatism of central bankers, economists have not contributed substantially to an understanding of this important phenomenon.
Article
The rate of inflation in the U.S. has declined from an average of 4.5% in the period 1960-79 to an average of 3.6% in 1980-98. Between those two periods, the standard deviations of inflation and the output gap have also declined. These facts can be attributed to the interaction of three possible factors: a shift in central bank preferences, a reduction in the variability of aggregate supply shocks, and a more efficient conduct of monetary policy. In this paper we identify the relative roles of these factors. Our framework is based on the estimation of a small structural macro model for the U.S. economy jointly with the first order conditions, which solve the intertemporal optimization problem faced by the Fed. Overall, our results indicate that the policy preferences of the Fed, and in particular the (implicit) inflation target, have changed drastically with the advent of the Volcker-Greenspan era. In addition, we find that the variance of supply shocks has been lower and monetary policy has been conducted more efficiently during this period.
Article
In this paper we model and explain US macroeconomic outcomes subject to the discipline that monetary policy is set optimally. Exploiting the restrictions that come from optimal policymaking, we estimate the parameters in the Federal Reserve's policy objective function together with the parameters in its optimization constraints. For the period following Volcker's appointment as chairman, we estimate the implicit inflation target to be around 1.4% and show that policymakers assigned a significant weight to interest rate smoothing. We show that the estimated optimal policy provides a good description of US data for the 1980s and 1990s. Copyright © 2005 John Wiley & Sons, Ltd.
Article
This short paper employs individual voting records of the Monetary Policy Committee (MPC) of the Bank of England to study heterogeneity in policy preferences among committee members. The analysis is carried out using a simple generalization of the standard New Keynesian framework that allows members to differ in the weight they give to output compared with inflation stabilization and in their views regarding optimal inflation and natural output. Results indicate that, qualitatively, MPC members are fairly homogeneous in their policy preferences, but there are systematic quantitative differences in their policy reaction functions that are related to the nature of their membership and career background.
Article
The design of monetary policy depends on the targeting strategy adopted by the central bank. This strategy describes a set of policy preferences, which are actually the structural parameters to analyse monetary policy making. Accordingly, we develop a calibration method to estimate a central bank's preferences from the estimates of an optimal Taylor–type rule. The empirical analysis on US data shows that output stabilization has not been an independent argument in the Fed's objective function during the Greenspan's era. This suggests that the output gap has entered the policy rule only as leading indicator for future inflation, therefore being only instrumental (to stabilize inflation) rather than important per se. (J.E.L.: C61, E52, E58).
Article
From the relative weight on output and inflation fluctuations in the Central Bank’s loss function, we can see which goal the monetary authority dislikes. I propose the method to estimate this weight, which is different from Cecchetti and Ehrmann [Does Inflation Targeting Increase Output Volatility? An International Comparison of Policymakers’ Preferences and Outcomes. NBER Working Paper 7426], and examine monetary policies in Japan, the UK, and the US after the first oil shock. It is found that the UK has the most aversion to output variability among the three in the full sample and that all of the three countries have disliked inflation variability from about 1980.
Article
The paper reviews the recent literature on monetary policy rules. We exposit the monetary policy design problem within a simple baseline theoretical framework. We then consider the implications of adding various real world complications. Among other things, we show that the optimal policy implicitly incorporates inflation targeting. We also characterize the gains from making a credible commitment to fight inflation. In contrast to conventional wisdom, we show that gains from commitment may emerge even if the central bank is not trying to inadvisedly push output above its natural level. We also consider the implications of frictions such as imperfect information.
Article
Do the macroeconomic priorities of citizens differ across countries? If so, what accounts for this variation and what are its consequences for explanations of the choice of monetary institutions, macroeconomic policy, and international monetary cooperation? This article uses survey data from twenty advanced economies to examine individual preferences about macroeconomic priorities. The analysis establishes three key findings. First, the results suggest that economic context, defined by inflation and unemployment performance, has a substantial impact on the public s economic objectives in a way that is broadly consistent with the specification of utility loss functions in the theoretical political economy literature. Second, the results suggest that there is significant cross-country variation in inflation aversion, controlling for economic context. Third, some of this variation is accounted for by national-level factors affecting the aggregate costs of inflation and unemployment. These results have significant implications for optimal monetary policymaking, the explanation of variation in economic outcomes, and for accounts of the choice of institutional frameworks for policymaking.I thank the Bank of England, the Center for Basic Research in the Social Sciences, and the Institution for Social and Policy Studies for research support, and Jim Alt, Andrew Bailey, Bill Bernhard, Lawrence Broz, John Freeman, Jeff Frieden, Jim Granato, Shigeo Hirano, David Lake, Jeff Lax, Simon Price, Rose Razaghian, Ron Rogowski, David Stasavage, Gabriel Sterne, Mike Tomz, Jim Vreeland, the editor, and two anonymous reviewers for helpful comments. All views expressed are those of the author and do not represent those of the Bank of England.
Culture andInstitutions, NBER Working Paper
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For Our Daughters: how Outstanding Women Worldwide Have Balanced Home and Career
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Cox-Fill, Olivia, 1996. For Our Daughters: how Outstanding Women Worldwide Have Balanced Home and Career. Praeger, Us.
A horrible way to fill the second most powerful job in America
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Six Things you Need to Know about Women in Central Banking
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Gender and monetary policymaking: trends, drivers and effects
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Masciandaro, Donato, Paola Profeta, Davide Romelli, 2016. Gender and monetary policymaking: trends, drivers and effects, BAFFI CAREFIN Centre Research Paper Series (2015-12)
OBAMA: both Yellen and Summers are 'outstanding candidates' for fed chair
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