Central Bank Independence and Central Bank Conservatism: Theory with an Application to Iran

The Sensitivity of Central Bank Independence Measurements to Inflation in Iran: A New Approach

The purpose of this study is finding the sensitivity of central bank independence measurements on its impact on inflation in Iran. To this aim different measurements of the central bank independence were calculated using the indices of Grilli et al. (1991), Cukierman et al. (1992), Mathew (2006) and Dumiter (2009) for the period 1961-2012 . Although results of correlation between CBI index and ...

Central Bank Independence and Macro- prudential Regulation

We consider the optimality of various institutional arrangements for agencies that conduct macro-prudential regulation and monetary policy. When a central bank is in charge of price and financial stability, a new time inconsistency problem may arise. Ex-ante, the central bank chooses the socially optimal level of inflation. Ex-post, however, the central bank chooses inflation above the social o...

Debt, inflation and central bank independence

Increasing the independence of a central bank from political influence, although ex-ante socially beneficial and initially successful in reducing inflation, would ultimately fail to lower inflation permanently. The smaller anticipated policy distortions implemented by a more independent central bank would induce the fiscal authority to decrease current distortions by increasing the deficit. Ove...

Central Bank Independence and Financing Government Spending*

The impact of Central bank independence on stock market volatility

The new paradigm in monetary policymaking gives accent to central banks‘ Independence. It is widely accepted that in modern monetary policymaking, central banks have three key goals: price stability, output stability and financial stability. Recent studies on central bank independence mainly investigate the effects of central bank independence on economic stability. But the effectiveness of cen...

Collective Bargaining and Its Effect on the Central Bank Conservatism: Theory and Some Evidence

____________________ 1 I am grateful to Alex Cukierman for his guidance. I also wish to thank Nissan Liviatan, participants at the Bank of Israel Seminar and participants at the TAU macroeconomics workshop for their helpful comments. Any views expressed in the Discussion Paper Series are those of the authors and do not necessarily reflect those of the Bank of Israel.