Checks and Balances, Private Information, and the Credibility of Monetary Commitments PDF Download

Author: Philip Keefer
Publisher: World Bank Publications
ISBN:
Category : Anti-inflationary policies
Languages : en
Pages : 46

View

Book Description
In economically volatile conditions in which it is more difficult for the public to distinguish inflation deliberately generated by government from inflation created by unanticipated economic shocks, the anti-inflationary effect of central bank independence will be unchanged but the effectiveness of exchange rate pegs will be significantly improved. Keefer and Stasavage develop and test several new hypotheses about the anti-inflationary effect of central bank independence and exchange rate pegs in the context of different institutions and different degrees of citizen information about government policies.

Author: Philip Keefer
Publisher:
ISBN:
Category :
Languages : en
Pages :

View

Book Description
The authors develop and test several new hypotheses about the anti-inflationary effect of central bank independence and exchange rate pegs in the context of different institutions and different degrees of citizen information about government policies. Theory provides strong reason to believe that while central bank independence will prove more effective as a commitment mechanism in countries where multiple players in government have veto power (checks and balances), the number of veto players will have no effect on the credibility of exchange rate pegs. Conversely, the authors argue that central bank independence does not solve the problems of commitment that arise when citizens are imperfectly informed about the contribution of government policy to inflation. Exchange rate pegs, however, mitigate these problems. The authors present extensive evidence from cross-country tests using newly developed data that provide strong support for their propositions.

Author: William Bernhard
Publisher: MIT Press
ISBN: 9780262265287
Category : Business & Economics
Languages : en
Pages : 236

View

Book Description
Political economists consider the political and economic factors that affect a country's choice of monetary institutions. Recent analysis by political economists of monetary institution determinants in different countries has been limited by the fact that exchange rate regimes and central bank institutions are studied in isolation from each other, without examining how one institution affects the costs and benefits of the other. By contrast, the contributors to this volume analyze the choice of exchange rate regime and level of central bank independence together; the articles (originally published in a special issue of International Organization) constitute a second generation of research on the determinants of monetary institutions. The contributors consider both economic and political factors to explain a country's choice of monetary institutions, and examine the effect of political processes in democracies, including interest group pressure, on the balance between economic and distributional policy.

Author: S. Eijffinger
Publisher: Edward Elgar Publishing
ISBN: 1849805768
Category : Business & Economics
Languages : en
Pages : 673

View

Book Description
ÔThis Handbook is a must read for policy makers and practitioners alike as well as excellent reading for advanced academic courses in international banking.Õ Ð Allard Bruinshoofd, SUERF ÔThis collection of papers is essential reading for anyone interested in central banking, regulation and supervision. Sylvester Eijffinger and Donato Masciandaro have brought together contributions from the leading academics, central bankers and regulators, providing the most up-to-date analysis of this critical subject.Õ Ð Paul Mizen, University of Nottingham, UK This stimulating and original Handbook offers an updated and systematic discussion of the relationship between central banks, financial regulation and supervision after the global financial crisis. The crisis has raised new questions about the compatibility of monetary and financial stability, which are changing the face of central banking and its relationships with the architecture of financial regulation and supervision. The Handbook explores on both the economics and political economy of the topic, in order to understand how and why reforms of the role of the central banks can be designed and implemented. The general suggestion is that future effectiveness of the central banking architecture will depend on its ability to ensure the consistency between the monetary actions in normal and extraordinary times. Consequently the possible paths in the central bank strategies and tactics, as well as in the classic concepts of independence, accountability and transparency, are analyzed and discussed. With chapters written by outstanding scholars in economics, this lucid Handbook will appeal to academics, policymakers and practitioners, ranging from central bankers and supervisory authorities to financial operators. Among the academics it would be of particular interest to financial and monetary economists (including postgraduate students), but the institutional slant and the central theme of relations between economics, institutional settings and politics will also be invaluable for political scientists.

Author: Jana Grittersová
Publisher: University of Michigan Press
ISBN: 0472123084
Category : Political Science
Languages : en
Pages : 310

View

Book Description
Nations with credible monetary regimes borrow at lower interest rates in international markets and are less likely to suffer speculative attacks and currency crises. While scholars typically attribute credibility to domestic institutions or international agreements, Jana Grittersová argues that when reputable multinational banks headquartered in Western Europe or North America open branches and subsidiaries within a nation, they enhance that nation’s monetary credibility. These banks enhance credibility by promoting financial transparency in the local system, improving the quality of banking regulation and supervision, and by serving as private lenders of last resort. Reputable multinational banks provide an enforcement mechanism for publicized economic policies, signaling to international financial markets that the host government is committed to low inflation and stable currency. Grittersová examines actual changes in government behavior of nations trying to gain legitimacy in international financial markets, and the ways in which perceptions of these nations change in relation to multinational banks. In addition to quantitative analysis of over 80 emerging-market countries, she offers extensive case studies of credibility building in the transition countries of Eastern Europe, Argentina in 2001, and the global financial crisis of 2008. Grittersová illuminates the complex interactions between multinational banks and national policymaking that characterize the process of financial globalization to reveal the importance of market confidence in a world of mobile capital.

Author: Roger D. Congleton
Publisher: Oxford University Press
ISBN: 0190469781
Category : Business & Economics
Languages : en
Pages : 800

View

Book Description
The Oxford Handbook of Public Choice provides a comprehensive overview of the research in economics, political science, law, and sociology that has generated considerable insight into the politics of democratic and authoritarian systems as well as the influence of different institutional frameworks on incentives and outcomes. The result is an improved understanding of public policy, public finance, industrial organization, and macroeconomics as the combination of political and economic analysis shed light on how various interests compete both within a given rules of the games and, at times, to change the rules. These volumes include analytical surveys, syntheses, and general overviews of the many subfields of public choice focusing on interesting, important, and at times contentious issues. Throughout the focus is on enhancing understanding how political and economic systems act and interact, and how they might be improved. Both volumes combine methodological analysis with substantive overviews of key topics. This second volume examines constitutional political economy and also various applications, including public policy, international relations, and the study of history, as well as methodological and measurement issues. Throughout both volumes important analytical concepts and tools are discussed, including their application to substantive topics. Readers will gain increased understanding of rational choice and its implications for collective action; various explanations of voting, including economic and expressive; the role of taxation and finance in government dynamics; how trust and persuasion influence political outcomes; and how revolution, coups, and authoritarianism can be explained by the same set of analytical tools as enhance understanding of the various forms of democracy.

Author: Roger D. Congleton
Publisher: Oxford Handbooks
ISBN: 0190469773
Category : Business & Economics
Languages : en
Pages : 1017

View

Book Description
"This two-volume collection provides a comprehensive overview of the past seventy years of public choice research, written by experts in the fields surveyed. The individual chapters are more than simple surveys, but provide readers with both a sense of the progress made and puzzles that remain. Most are written with upper level undergraduate and graduate students in economics and political science in mind, but many are completely accessible to non-expert readers who are interested in Public Choice research. The two-volume set will be of broad interest to social scientists, policy analysts, and historians"--

Author: Ralph Setzer
Publisher: Springer Science & Business Media
ISBN: 3790817163
Category : Business & Economics
Languages : en
Pages : 265

View

Book Description
This book considers the issue of exchange rate policymaking from a political economy perspective. It illustrates both theoretically and empirically how domestic political and institutional incentives shape exchange rate policies in developing countries. Empirical analysis is based on a panel survey of 47 countries and thereby provides insights on how political and institutional conditions typically affect exchange rate policy.

Author: Eduardo Wiesner
Publisher: Edward Elgar Publishing
ISBN: 184844026X
Category : Business & Economics
Languages : en
Pages : 297

View

Book Description
This book is a must read for anyone interested in policy reforms in Latin America. The author combines tremendous experience in the field and deep knowledge of economic theory: a rare combination. Alberto Alesina, Harvard University, US One of the key contributions of this book is its insistence on the importance of policy, institutional and political accountability for evaluating and enhancing macroeconomic performance and for reducing inequality. John B. Taylor, Stanford University and Hoover Institution, US Dr Wiesner combines a command of modern political and economic theories and detailed knowledge of Latin America to clarify why reform of policies and institutions has proved so difficult in that region. His general conclusion is that initial conditions of inequality and poverty reduce the demand for reform, but he finds that the process manifests itself differently in different countries. He identifies several necessary conditions for breaking out of these vicious circles. Scholars and practitioners alike can learn from his impressively thorough and detailed analysis. Avinash K. Dixit, Princeton University, US This book argues insightfully that underdevelopment is the result of the political economy difficulties some countries have in the effectiveness of public expenditures in general and of social pro-poor expenditures in particular. The policy implication is that reform strategies should focus on identifying the wrong political incentives in public expenditures. Ricardo Hausmann, Harvard University, US Eduardo Wiesner s book makes an important contribution to the understanding of development by blending together the interdependent issues of (i) macroeconomic performance and volatility, (ii) equity and distributive justice, (iii) fiscal deficits and the redistributive effectiveness of social public expenditures, and (iv) the demand for the right institutions and for policy reform in Latin America. It does this by examining recent macroeconomic crises from a political economy perspective, and finds that information is the critical algorithm that links together the demand for macroeconomic stability, macroeconomic performance and, ultimately, distributive justice. This volume is geared toward those interested in the political economy of development and policy reform in general and in Latin America, including academics, policy makers, and the general reader.

Author: B. Rother
Publisher: Springer
ISBN: 0230233643
Category : Political Science
Languages : en
Pages : 188

View

Book Description
This book explores the role of political factors in the occurrence of currency crises, using an eclectic approach that blends case studies, a rigorous theoretical discussion, and econometric analysis.