Who Wants an Independent Central Bank? Monetary Policy-making and Politics
The costs and benefits of cooperative monetary and fiscal policy are analysed in the framework of a partisan business-cycles model. It is shown that political parties with different ideologies prefer to choose different arrangements for macroeconomic policy-making. More specifically, right-wing part...
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Published in | The Scandinavian journal of economics Vol. 102; no. 4; pp. 621 - 643 |
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Main Author | |
Format | Journal Article |
Language | English |
Published |
Oxford, UK and Boston, USA
Blackwell Publishers Ltd
01.12.2000
Blackwell Publishers Wiley Blackwell Basil Blackwell Ltd., etc Blackwell Publishing Ltd |
Series | Scandinavian Journal of Economics |
Subjects | |
Online Access | Get full text |
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Summary: | The costs and benefits of cooperative monetary and fiscal policy are analysed in the framework of a partisan business-cycles model. It is shown that political parties with different ideologies prefer to choose different arrangements for macroeconomic policy-making. More specifically, right-wing parties favour independent central banks more than left-wing parties. An independent central bank is also the generally preferred option from a social welfare point of view. In addition, the form of policy-making arrangements between the fiscal and monetary authorities is shown to influence the extent of partisan cycles. |
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Bibliography: | ark:/67375/WNG-KMD9WC2M-X istex:1ADB30377799B9093B47729D7E0B6345427932FA ArticleID:SJOE218 ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 23 |
ISSN: | 0347-0520 1467-9442 1467-9442 |
DOI: | 10.1111/1467-9442.00218 |