Elements of Optimal Monetary Policy Committee Design

December 1, 2006

Preview Citation

Format: Chicago

Jerome Vandenbussche. Elements of Optimal Monetary Policy Committee Design, (USA: International Monetary Fund, 2006) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The move from individual decision making to committee decision making is widely seen as a major evolution in contemporary central banking. This paper reviews the relevant economics and social psychology literatures with a view to providing some insights into the question of optimal monetary policy committee design. While the preference aggregation literature points to the effect of committee structure on the extent of the time inconsistency problem and its associated costs, the belief aggregation literature analyzes how different committee structures affect the efficiency of information pooling, the process of social influence, and collective accuracy. In conclusion, we highlight the main tradeoffs that the analysis has brought to light and point to directions for future research.

Subject: Banking, Central bank legislation, Communications in revenue administration, Inflation, Tax incentives

Keywords: Committee structure, Implementation board, Majority vote, Policy board, Rate of inflation, Simple majority, WP

Publication Details

Pages:

38
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2006/277
Stock No:

WPIEA2006277
ISBN:

9781451865370
ISSN:

1018-5941

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