The theoretical argument for central bank independence is based on the idea that even if the government represents people's preferences over inflation and output it has an incentive to renege from prearranged plans to gain a short run boost to output. This incentive leads to higher than desired...

There is a considerable academic literature on the relationship between Central Bank independence and inflation but the issue of Central Bank accountability and its effect of inflation performance has received very little attention. This paper looks at the issue of accountability in a simple...

This paper aims at studying the relevance of the Central Bank of Brazil's independence for the efficiency of the stabilization policy in this country. Initially, it presents and discusses the main theoretical results concerning the central banks'independence. The normative theory emphasizes that...

Independent central banking has experienced a surge in public and academic attention during the past few years, and even more so during the ongoing COVID-19 crisis. An expanding toolset, heightened prominence and increasingly controversial policies have arguably pushed independent monetary...

We parameterize central-bank independence in terms of partisanship and term length, and we focus on the implications of alternative policy structures for real economic activity. While long terms of office for the central banker can reduce the role of electoral surprises, term lengths that are...

In this paper, we survey the case for central bank independence (CBI). We conclude that CBI is neither necessary nor sufficient for monetary stability. CBI is just one potentially useful monetary policy design instrument among several, and CBI should not be treated as an exogenous variable....

A central bank has preferences that differ from the political authority. While the central bank is independent, i.e. it maximizes its own preferences, households do not know this. Instead, households observe the interest rate choices of the central bank and update their beliefs regarding central...

This paper reviews recent developments on central banking. The first part discusses the institutions irrelevance hypothesis raised by Posen. According to this view, the central bank independence (CBI) effectiveness as an arrangement for achieving a low inflation rate depends heavily upon the...

This paper investigates the determinants of countries' choice of monetary policy frameworks (MPF) for emerging and developing countries. Countries make different MPF choices and we think it is because they have different country-level characteristics (e.g. democratic strength and trade...

The research work presented below addresses the possible concern of central bank independence through the development and application of econometric models. The complexity of the modelling has allowed a step further in corroborating that financial independence is not only linked to the...