The U.S. residential housing market collapse illustrates the consequences of ignoring risk while funding mortgage borrowing. Collateral over-valuation was a foundational piece of the crisis. Over the past few decades, secondary markets, securitization, policy and psychology increased the flow of...

This work empirically investigates the effect of the interaction between the rule of law and legal central bank independence (CBI) on price stability (the level of inflation and inflation volatility), employing a panel dataset that covers up to 124 countries over the period from 1970 to 2013. A...

This chapter presents the main elements of central banks’ traditional functions as gatekeepers of monetary and broader financial and economic stability and outlines some emerging considerations relating to central banks’ enhanced role as guardians of public interest. With regard to the...

This paper proposes that central bank independence alone is insufficient to explain low inflation. It argues instead that central bank independence may be interconnected with public attitudes towards inflation via a historical feedback process that has led to an anti-inflation culture and public...

Note: The following is a description of the paper, and not the actual abstract as it appeared in the journal. An important mainstream macroeconomic explanation of differences in inflation rates between countries, here coined the ?orthodox' view, emphasises the independence of the central bank as...