Because of secrecy, little is known about the political economy of central bank lending. Utilizing a novel, hand-collected historical daily dataset on loans to commercial banks, we analyze how personal connections matter for lending of last resort, highlighting the importance of governance for...

Germany prides itself in having one of the most successful central banks and currencies with respect to independence and stability. I show that not only were both imposed on the country after 1945 but that there was also initial resistance to both among German experts and officials. This is a...

This paper empirically studies the impact of the quality of political institutions on the link between central bank independence and inflation. Making use of data on the evolution of central bank independence over time and controlling for possible nonlinearities, we employ interaction models to...

We study how the optimal degree of conservatism relates to decision-making procedures in a Monetary Policy Committee (MPC). In our framework, central bank conservatism is required to attenuate the volatility of monetary decisions generated by the presence of uncertainty about the committee...

Many inflation targeting central banks are facing calls to expand their list of policy goals. I discuss how recent research provides new insights into the goals of policy and the tradeoffs presented by multiple goals. I focus particular attention on the role of unemployment and labor market...

Soon, euro area membership could more than double, with the vast majority of accession countries being quite different in economic terms compared with current members. Under the current decision-making system, this can lead to high decisionmaking costs and there is a risk that monetary policy...

This paper reports the results of a survey among private sector economists about credibility and transparency of central banks. In line with the survey of Alan Blinder among central bankers, we asked participants in Ifo s World Economic Survey to answer questions on the importance and...