Monetary Policy Committees: Individual and Collective Reputations

By A. Sibert. Social Science Research Network, 2003

175 citations recorded by the source corpus.

This paper looks at the incentives of individual members of a monetary policy committee to gain a reputation for inflationary toughness. I show a policy maker can have more or less incentive to build a reputation when part of a group. But, group policy making leads to higher expected social welfare. Not publishing individuals' votes, raises the temptation to inflate and lowers expected social welfare. If the culture or rules of a central bank puts more weight on senior policy makers, the incentive to build a reputation is greater, but expected social welfare may be higher or lower. Copyright 2003, Wiley-Blackwell.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/1897f8160d3fb3ad815cf47c2c645b0fed1d6ac0

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Citations in the corpus

Communication and Decision-Making by Central Bank Committees: Different Strategies, Same Effectiveness? (2005, unknown): “…as the ability to pool judgments of different individuals (Blinder and Morgan 2000), ability to learn from other members (Lombardelli, Proudman and Talbot 2002) or the increased flexibility that committees show in responding to shocks of different magnitudes (Sibert 2003, Mihov and Sibert 2004).”
Decision Making in Committees: Transparency, Reputation, and Voting Rules (2007, background): “More closely related are Gersbach and Hahn (2001), Fingleton and Raith (2005), Stasavage (2004) and Sibert (2003), who focus directly on the comparison between secretive and transparent mechanisms.”
Transparency of Monetary Policy: Theory and Practice (2006, background): “In par- ticular, ‘doves’ in the monetary policy committee that vote for inflationary actions would be exposed, which could induce them to build reputation by voting as an anti-inflationary ‘hawk’ (Sibert 2003).”
Central Banking by Committee (2006, unknown): “In Waller (2000), Sibert (2003) and Mihov and Sibert (forthcoming) the smoother in ation path generated by committees tends to raise welfare; in Kristen-Gerach (2005), the slow and muted response to shocks is undesirable.”
Committees Versus Individuals: An Experimental Analysis of Monetary Policy Decision-Making (2005, unknown): “With the exception of Gerlach-Kristen (2001) and Sibert (2003), the theoretical economics literature does not have much to say about the consequences of delegating responsibility to a committee.”