This paper examines how the transparency in monetary policy decision can impact the likelihood of currency crisis in a simple open economy model with public debt. In the presence of opacity, it is found that if the debt is high, the government will devaluate and vice versa, and the...

In this paper, we examine the link between political transparency of a common central bank (CCB) and decentralized supply-side fiscal policies in a monetary union. We find that the opacity of a conservative CCB has a restrictive effect on national fiscal policies since each government...

This paper extends the results of Kobayashi (2003) and Ciccarone and Marchetti (2009) by considering the optimal choice of central bank conservativeness. It is shown that the government can choose a sufficiently populist but opaque central banker so that higher multiplicative uncertainty...