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The benefits of central bank's political independence

Author

Listed:
  • Emmanuelle Gabillon

    (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique)

  • David Martimort

    (GREMAQ - Groupe de recherche en économie mathématique et quantitative - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper analyzes the relationship between a central banker and his partisan political principals. Incentive contracts for central bankers are not designed by social planners but by partisan political principals who obey to their own incentives.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Emmanuelle Gabillon & David Martimort, 2004. "The benefits of central bank's political independence," Post-Print hal-00167817, HAL.
    • Handle: RePEc:hal:journl:hal-00167817
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    References listed on IDEAS

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    17. Walsh, Carl E, 1995. "Optimal Contracts for Central Bankers," American Economic Review, American Economic Association, vol. 85(1), pages 150-167, March.
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    Citations

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    Cited by:

    1. Francesco Salsano, 2022. "Monetary policy when the objectives of central bankers are imperfectly observable," Scottish Journal of Political Economy, Scottish Economic Society, vol. 69(4), pages 396-415, September.
    2. Florin Cornel DUMITER, 2014. "Central Bank Independence, Transparency and Accountability Indexes: a Survey," Timisoara Journal of Economics and Business, West University of Timisoara, Romania, Faculty of Economics and Business Administration, vol. 7(1), pages 35-54.
    3. Francesco Salsano, 2018. "Political Stabilization by an independent Central Bank," Birkbeck Working Papers in Economics and Finance 1805, Birkbeck, Department of Economics, Mathematics & Statistics.
    4. Jac C. Heckelman & Bonnie Wilson, 2021. "Targeting inflation targeting: the influence of interest groups," Public Choice, Springer, vol. 189(3), pages 533-554, December.
    5. Pierre C. Boyer & Jorge Ponce, 2011. "Central Banks and Banking Supervision Reform," Chapters, in: Sylvester Eijffinger & Donato Masciandaro (ed.), Handbook of Central Banking, Financial Regulation and Supervision, chapter 6, Edward Elgar Publishing.
    6. Esteban Colla De Robertis, 2010. "Monetary Committee Size and Special Interest Influence," Documentos de Investigación - Research Papers 2, CEMLA.
    7. Pierre C. Boyer & Jorge Ponce, 2010. "Central banks, regulatory capture and banking supervision reform," Documentos de trabajo 2010003, Banco Central del Uruguay.
    8. Jorge Ponce, 2010. "A Normative Analysis of Banking Supervision: Independence, Legal Protection and Accountability," Money Affairs, CEMLA, vol. 0(2), pages 141-181, July-Dece.
    9. Fraccaroli, Nicolò & Sowerbutts, Rhiannon & Whitworth, Andrew, 2020. "Does regulatory and supervisory independence affect financial stability?," Bank of England working papers 893, Bank of England.
    10. Francesco Salsano, 2020. "Monetary Policy Capture and Political Stabilization," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 12(1), pages 1-8, January.
    11. Dumiter Florin Cornel, 2012. "Empirical Approach Upon The Relationship Between Central Bank Independence And Inflation In Developed And Developing Countries," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 803-808, July.
    12. Poomjai Nacaskul & Kritchaya Janjaroen & Suparit Suwanik, 2012. "Economic Rationales for Central Banking: Historical Evolution, Policy Space, Institutional Integrity, and Paradigm Challenges," Working Papers 2012-04, Monetary Policy Group, Bank of Thailand.

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    More about this item

    JEL classification:

    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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