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Welfare effects of public information

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  • Shin, Hyun Song
  • Morris, Stephen

Abstract

What are the welfare effects of enhanced disclosures of public information – Is it always the case, that frequent and timely publication of economic statistics by government agencies and the central bank are desirable – This question has become one of several interlinked strands of debate on the desirability of transparency in hte conduct of monetary policy. Here we put to the test the presumption that greater disclosures of public information is always welfare enhancing. We examine the impact of public information in a setting where a principal provides public information to private sector agents. The principal's interest is in inducing the agents to take actions that are appropriate to the fundamentals. The agents, too, are motivated to take actions appropriate to the underlying state, but they also have a coordination motive arising from a strategic complementarity in their actions. When there is perfect information concerning the underlying state, there is no conflict of interest between the principal and the agents. However, when there is imperfect information, the welfare effects of increased public disclosures is more equivocal. -- Welche Wohlfahrtseffekte hat eine größere Publizität öffentlicher Informationen? Ist die häufige und zeitnahe Veröffentlichung von Wirtschaftsstatistiken durch Regierungsstellen und die Zentralbank immer wünschenswert? Diese Frage zieht sich wie ein roter Faden durch die Diskussion über das Thema, inwieweit Transparenz bei der Durchführung der Geldpolitik wünschenswert ist. Wir prüfen die These, dass eine verbesserte Publizität öffentlicher Informationen stets wohlfahrtssteigernd ist. Wir wollen im Rahmen eines Modells, bei dem der Prinzipal (Zentralbank) Informationen an die Akteure im privaten Sektor gibt herausfinden, wie öffentliche Informationen wirken. Der Informationsgeber möchte bewirken, dass die Akteure den wirtschaftlichen Grunddaten entsprechend handeln. Die Akteure sind ihrerseits auch daran interessiert, ihr Handeln an den grundlegenden Bedingungen zu orientieren, aber sie sind auch auf Koordination bedacht, da sich ihre Handlungen aus strategischen Gründen gegenseitig ergänzen müssen. Bei vollkommener Information über die Grundbedingungen besteht kein Interessenkonflikt zwischen Informationsgeber und Akteuren. Bei unvollkommener Information hingegen sind die Wohlfahrtseffekte einer größeren Publizität öffentlicher Informationen weniger eindeutig.

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Bibliographic Info

Paper provided by Deutsche Bundesbank, Research Centre in its series Discussion Paper Series 1: Economic Studies with number 2000,07.

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Date of creation: 2000
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Handle: RePEc:zbw:bubdp1:4143

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Cited by:
  1. Jean-Charles Rochet & Xavier Vives, 2002. "Coordination Failures and the Lender of Last Resort: Was Bagehot Right After All?," FMG Discussion Papers, Financial Markets Group dp408, Financial Markets Group.
  2. Georgios Chortareas & David Stasavage & Gabriel Sterne, 2001. "Does it pay to be transparent? International evidence from central bank forecasts," Bank of England working papers, Bank of England 143, Bank of England.
  3. Stephen Morris & Hyun Song Shin, 2001. "The CNBC Effect: Welfare Effects of Public Information," Cowles Foundation Discussion Papers, Cowles Foundation for Research in Economics, Yale University 1312, Cowles Foundation for Research in Economics, Yale University.
  4. Stephen Morris & Hyun Song Shin, 2004. "Heterogeneity and Uniqueness in Interaction Games," Yale School of Management Working Papers, Yale School of Management ysm341, Yale School of Management.
  5. Jose M P Jorge, 2007. "Financial System Architecture: The Role of Systemic Risk, Added Value and Liquidity," Money Macro and Finance (MMF) Research Group Conference 2006, Money Macro and Finance Research Group 155, Money Macro and Finance Research Group.
  6. Metz, Christina E., 2000. "Private and public information in self-fulfilling currency crises," Research Notes 00-7, Deutsche Bank Research.

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