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The Bundesbank's Communications Strategy and Policy Conflicts with the Federal Government

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  • Siklos, Pierre L.
  • Bohl, Martin T.

Abstract

In this paper we provide an estimate of the likelihood of conflict between the federal government and the Bundesbank for the 1989 – 1998 period. We rely on a novel proxy for the impact of public communication by Bundesbank officials on the probability of conflict, in addition to interest rate, exchange rate, money supply behavior, as well as electoral influences. The empirical evidence is consistent with the view that speeches by the Bundesbank President dealing with inflation and economic policy are a positive source of conflict in a probabilistic sense. Conflict was not a constant but flared up at times of economic stress and could be exacerbated by the "talking" of Bundesbank officials.

Suggested Citation

  • Siklos, Pierre L. & Bohl, Martin T., 2005. "The Bundesbank's Communications Strategy and Policy Conflicts with the Federal Government," Working Paper Series 2005,8, European University Viadrina Frankfurt (Oder), The Postgraduate Research Programme Capital Markets and Finance in the Enlarged Europe.
    • Handle: RePEc:zbw:euvgra:20058
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    More about this item

    Keywords

    Deutsche Bundesbank; Conflict; Central Bank Communication; Political Factors;
    All these keywords.

    JEL classification:

    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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