Data from a unique monetary 'experiment' conducted in the UK during the period 1994-97 are used to investigate the cost of political intervention in monetary policy. The paper finds that the difference between government bond yields in Germany (but not the US) and the UK was systematically related to an index of the credibility of monetary policy constructed on the basis of the frequency of agreements / disagreements between the Minister of Finance who took the decisions on interest rates and the Bank of England, whose recommendations were published with a lag, with disagreements causing an increase in the yield differential.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Length: Date of creation: Dec 2001 Date of revision: Handle: RePEc:san:wpecon:0114
Contact details of provider: Postal: School of Economics and Finance, University of St. Andrews, Fife KY16 9AL Phone: 01334 462420 Fax: 01334 462444 Web page: http://www.st-andrews.ac.uk/economics/
Order Information: Email:
For technical questions regarding this item, or to correct its listing, contact: (Peter Macmillan).
Find related papers by JEL classification: E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
This paper has been announced in the following NEP Reports: