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The role of regional information in the optimal composition of a committee

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  • Philipp Maier

    (The Netherlands Central Bank)

  • Beata K. Bierut

    (The Netherlands Central Bank)

  • Robert-Paul Berben

    (The Netherlands Central Bank)

Abstract

In this paper we present a model for the optimal composition of a federal or supra-national committee. The involvement of regional (national) entities in federal committees is typically motivated by their knowledge of regional information about the state of the economy. Using this argument we show that if the uncertainties regarding the state of the economy are not evenly distributed across the currency area, the optimal representation of regions in the federal committee increases with the overall uncertainty about their economic performance. Second, if certain parts of the economic area behave in a relatively synchronized way, it may not be necessary that all these regions are equally represented in the federal committee.

Suggested Citation

  • Philipp Maier & Beata K. Bierut & Robert-Paul Berben, 2003. "The role of regional information in the optimal composition of a committee," Macroeconomics 0309014, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpma:0309014
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    Cited by:

    1. Helge Berger, 2006. "Optimal central bank design: Benchmarks for the ECB," The Review of International Organizations, Springer, vol. 1(3), pages 207-235, September.
    2. Agnès Bénassy-Quéré & Edouard Turkisch, 2009. "The ECB Governing Council in an Enlarged Euro Area," Journal of Common Market Studies, Wiley Blackwell, vol. 47, pages 25-53, January.
    3. Helge Berger & Till Mueller, 2007. "How should large and small countries be represented in a currency union?," Public Choice, Springer, vol. 132(3), pages 471-484, September.
    4. Piotr Stanek, 2004. "How to assess proposals for enlargement reform of the European Central Bank," Revue de l'OFCE, Presses de Sciences-Po, vol. 91(5), pages 209-239.

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    More about this item

    Keywords

    Composition of a committee; currency union; optimal representation; information uncertainty;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions

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