Actual versus Perceived Central Bank Transparency: The Case of the European Central Bank
AbstractCentral banks have become more and more transparent about their monetary policy making process. In the central bank transparency lit- erature the distinction between actual and perceived central bank trans- parency is often lacking. However, as perceptions are crucial for the ac- tions of economic agents this distinction matters. A discrepancy between actual and perceived transparency may exist because of incomplete or in- correct transparency knowledge and other (psychological) factors. Even financial experts, the most important channel through which the central bank can influence the economy, might suffer from misaligned perceptions. We investigate the mismatch between actual and perceived transparency and its relevance by analyzing data of a Dutch household survey on the European Central Bank’s transparency. To benefit from higher trans- parency perceptions the European Central Bank might feel tempted to stress its transparency strengths, but hide its transparency weaknesses.
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Bibliographic InfoPaper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2007-78.
Date of creation: 2007
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Central bank transparency; Perceptions; Survey; CentERpanel; Behavioral Economics;
Other versions of this item:
- Eijffinger, Sylvester C W & van der Cruijsen, Carin A B, 2007. "Actual Versus Perceived Central Bank Transparency: The case of the European Central Bank," CEPR Discussion Papers 6525, C.E.P.R. Discussion Papers.
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
- E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-10-20 (All new papers)
- NEP-CBA-2007-10-20 (Central Banking)
- NEP-EEC-2007-10-20 (European Economics)
- NEP-MAC-2007-10-20 (Macroeconomics)
- NEP-MON-2007-10-20 (Monetary Economics)
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- Michael Ehrmann & Sylvester Eijffinger & Marcel Fratzscher, 2012.
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Scandinavian Journal of Economics,
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- Ehrmann, M. & Eijffinger, S.C.W. & Fratzcher, M., 2010. "The Role of Central Bank Transparency for Guiding Private Sector Forecasts," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3763052, Tilburg University.
- Ehrmann, Michael & Eijffinger, Sylvester C. W. & Fratzscher, Marcel, 2009. "The role of central bank transparency for guiding private sector forecasts," CEPR Discussion Papers 7585, C.E.P.R. Discussion Papers.
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