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On the Performance of Monetary Policy Committees

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  • Etienne Farvaque
  • Piotr Stanek
  • Stéphane Vigeant

Abstract

type="main"> This paper examines the influence of the biographical experience of monetary policy committee members on their performance in managing inflation and output volatility. Our sample covers major OECD countries in the 1999 to 2010 period. Using data envelopment analysis, we study the efficiency of monetary policy committees. Then, we look at the determinants of these performances. The results in particular show that (i) in crisis times, a smaller committee is more efficient, (ii) policymakers' background influence the performance, with a positive role for committee members coming from academia, central banks and the financial sector, although the latter lost their edge during the Great Recession. It is also shown that some committees have reduced the inefficiency created by the crisis more rapidly than others.

Suggested Citation

  • Etienne Farvaque & Piotr Stanek & Stéphane Vigeant, 2014. "On the Performance of Monetary Policy Committees," Kyklos, Wiley Blackwell, vol. 67(2), pages 177-203, May.
  • Handle: RePEc:bla:kyklos:v:67:y:2014:i:2:p:177-203
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    File URL: http://hdl.handle.net/10.1111/kykl.12049
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    Cited by:

    1. Jung, Alexander & Latsos, Sophia, 2015. "Do federal reserve bank presidents have a regional bias?," European Journal of Political Economy, Elsevier, vol. 40(PA), pages 173-183.
    2. Diouf, Ibrahima & Pépin, Dominique, 2017. "Gender and central banking," Economic Modelling, Elsevier, vol. 61(C), pages 193-206.
    3. Donato Masciandaro & Paola Profeta & Davide Romelli, 2016. "Gender and Monetary Policymaking: Trends and Drivers," BAFFI CAREFIN Working Papers 1512, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    4. Etienne Farvaque & Norimichi Matsueda, 2017. "Optimal Term Length For An Overconfident Central Banker," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 62(01), pages 179-192, March.
    5. Etienne Farvaque & Piotr Stanek & Stéphane Vigeant, 2014. "On the Performance of Monetary Policy Committees," Kyklos, Wiley Blackwell, vol. 67(2), pages 177-203, May.
    6. repec:bla:kyklos:v:71:y:2018:i:4:p:537-556 is not listed on IDEAS
    7. Hamza Bennani & Tobias Kranz & Matthias Neuenkirch, 2017. "Disagreement Between the FOMC and the Fed's Staff: New Insights Based on a Counterfactual Interest Rate," Research Papers in Economics 2017-10, University of Trier, Department of Economics.
    8. Ekor, Maxwell & Saka, Jimoh & Adeniyi, Oluwatosin, 2014. "Monetary Policy Committee and Monetary Policy Conduct in Nigeria: A Preliminary Investigation," MPRA Paper 60770, University Library of Munich, Germany, revised 2014.

    More about this item

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • 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
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes

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