IDEAS home Printed from https://ideas.repec.org/a/kap/pubcho/v203y2025i3d10.1007_s11127-024-01234-5.html
   My bibliography  Save this article

Political central bank coverage

Author

Listed:
  • Hugo Oriola

    (EconomiX, CNRS, Université Paris Nanterre
    LÉO, Université d’Orléans)

  • Matthieu Picault

    (LÉO, Université d’Orléans)

Abstract

We introduce the concept of Political Central Bank Coverage (PCBC), which refers to the influence of monetary policy-related media coverage on the popularity of political parties. Our study focuses on Germany and examines the period between January 2005 and December 2021. To explore PCBC, we gathered monthly popularity ratings for six German political parties. Through textual analysis we measured media coverage of monetary policy. Subsequently, we estimated popularity functions for the political parties, incorporating our textual measures and a dummy variable indicating the month prior to an election. Our findings highlight the existence of PCBCs in Germany in the month preceding federal elections and elections to the European Parliament. Importantly, these results remain robust across various methodological approaches, including the use of a seemingly unrelated regressions model, alternative preelectoral periods and different occurrence and sentiment measures. Furthermore, our study suggests that the presence of PCBC may be influenced by the partisanship of newspapers considered and the direct communication of the European Central Bank.

Suggested Citation

  • Hugo Oriola & Matthieu Picault, 2025. "Political central bank coverage," Public Choice, Springer, vol. 203(3), pages 573-647, June.
    • Handle: RePEc:kap:pubcho:v:203:y:2025:i:3:d:10.1007_s11127-024-01234-5
    DOI: 10.1007/s11127-024-01234-5
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11127-024-01234-5
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11127-024-01234-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Hugo Oriola, 2023. "Political monetary cycles: An empirical study," Post-Print hal-04648377, HAL.
    2. Mueller, John E., 1970. "Presidential Popularity from Truman to Johnson1," American Political Science Review, Cambridge University Press, vol. 64(1), pages 18-34, March.
    3. von-Hagen, Jurgen & Bruckner, Matthias, 2002. "Monetary and Fiscal Policy in the European Monetary Union," Monetary and Economic Studies, Institute for Monetary and Economic Studies, Bank of Japan, vol. 20(S1), pages 123-154, December.
    4. Carola Conces Binder, 2021. "Political Pressure on Central Banks," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 53(4), pages 715-744, June.
    5. Ferrara, Federico M. & Masciandaro, Donato & Moschella, Manuela & Romelli, Davide, 2022. "Political voice on monetary policy: Evidence from the parliamentary hearings of the European Central Bank," European Journal of Political Economy, Elsevier, vol. 74(C).
    6. Kayser, Mark Andreas, 2006. "Trade and the Timing of Elections," British Journal of Political Science, Cambridge University Press, vol. 36(3), pages 437-457, July.
    7. Hibbs, Douglas A., 1977. "Political Parties and Macroeconomic Policy," American Political Science Review, Cambridge University Press, vol. 71(4), pages 1467-1487, December.
    8. Hayo, Bernd & Henseler, Kai & Steffen Rapp, Marc & Zahner, Johannes, 2022. "Complexity of ECB communication and financial market trading," Journal of International Money and Finance, Elsevier, vol. 128(C).
    9. Ehrmann, Michael & Wabitsch, Alena, 2022. "Central bank communication with non-experts – A road to nowhere?," Journal of Monetary Economics, Elsevier, vol. 127(C), pages 69-85.
    10. Larcinese, Valentino & Puglisi, Riccardo & Snyder Jr., James M., 2011. "Partisan bias in economic news: Evidence on the agenda-setting behavior of U.S. newspapers," Journal of Public Economics, Elsevier, vol. 95(9-10), pages 1178-1189, October.
    11. Picault, Matthieu & Renault, Thomas, 2017. "Words are not all created equal: A new measure of ECB communication," Journal of International Money and Finance, Elsevier, vol. 79(C), pages 136-156.
    12. Christian Conrad & Michael J. Lamla, 2010. "The High‐Frequency Response of the EUR‐USD Exchange Rate to ECB Communication," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 42(7), pages 1391-1417, October.
    13. Helge Berger & Jakob De Haan & Sylvester C.W. Eijffinger, 2001. "Central Bank Independence: An Update of Theory and Evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 15(1), pages 3-40, February.
    14. repec:hal:journl:hal-03959147 is not listed on IDEAS
    15. Alexander Dentler, 2019. "Did the fed raise interest rates before elections?," Public Choice, Springer, vol. 181(3), pages 239-273, December.
    16. Dimitrios Asteriou & Simon Price, 2001. "Political Instability and Economic Growth: UK Time Series Evidence," Scottish Journal of Political Economy, Scottish Economic Society, vol. 48(4), pages 383-399, September.
    17. Hayo, Bernd & Neuenkirch, Edith, 2014. "The German public and its trust in the ECB: The role of knowledge and information search," Journal of International Money and Finance, Elsevier, vol. 47(C), pages 286-303.
    18. William Roberts Clark & Vincent Arel-Bundock, 2013. "Independent but Not Indifferent: Partisan Bias in Monetary Policy at the Fed," Economics and Politics, Wiley Blackwell, vol. 25(1), pages 1-26, March.
    19. Bennani, Hamza, 2020. "Central bank communication in the media and investor sentiment," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 431-444.
    20. Thomas Piketty & Fabian Kosse, 2020. "Electoral Cleavages and Socioeconomic Inequality in Germany 1949-2017," Working Papers halshs-03022265, HAL.
    21. repec:hal:cesptp:hal-03959147 is not listed on IDEAS
    22. Dani Rodrik, 2018. "Is Populism Necessarily Bad Economics?," AEA Papers and Proceedings, American Economic Association, vol. 108, pages 196-199, May.
    23. Niklas Engbom & Ms. Enrica Detragiache & Ms. Faezeh Raei, 2015. "The German Labor Market Reforms and Post-Unemployment Earnings," IMF Working Papers 2015/162, International Monetary Fund.
    24. Matthew Gentzkow & Jesse M. Shapiro, 2006. "Media Bias and Reputation," Journal of Political Economy, University of Chicago Press, vol. 114(2), pages 280-316, April.
    25. Weisskircher, Manès & Hutter, Swen & Borbáth, Endre, 2022. "Protest and Electoral Breakthrough: Challenger Party-Movement Interactions in Germany," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, issue (Latest A, pages 1-1.
    26. Dopke, Jorg & Pierdzioch, Christian, 2006. "Politics and the stock market: Evidence from Germany," European Journal of Political Economy, Elsevier, vol. 22(4), pages 925-943, December.
    27. Soeren Enkelmann, 2013. "Government Popularity and the Economy First Evidence from German Micro Data," Working Paper Series in Economics 274, University of Lüneburg, Institute of Economics.
    28. Matthieu Picault & Thomas Renault, 2017. "Words are not all created equal: A new measure of ECB communication," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-03205121, HAL.
    29. Munnes, Stefan & Harsch, Corinna & Knobloch, Marcel & Vogel, Johannes S. & Hipp, Lena & Schilling, Erik, 2022. "Examining Sentiment in Complex Texts. A Comparison of Different Computational Approaches," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 5, pages 1-1.
    30. Michael Lewis-Beck & Mary Stegmaier, 2013. "The VP-function revisited: a survey of the literature on vote and popularity functions after over 40 years," Public Choice, Springer, vol. 157(3), pages 367-385, December.
    31. Scott R. Baker & Nicholas Bloom & Steven J. Davis, 2016. "Measuring Economic Policy Uncertainty," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(4), pages 1593-1636.
    32. Sieg, Gernot, 1997. "A model of partisan central banks and opportunistic political business cycles," European Journal of Political Economy, Elsevier, vol. 13(3), pages 503-516, September.
    33. Hamza Bennani & Matthias Neuenkirch, 2017. "The (home) bias of European central bankers: new evidence based on speeches," Applied Economics, Taylor & Francis Journals, vol. 49(11), pages 1114-1131, March.
    34. Sergei Guriev & Elias Papaioannou, 2022. "The Political Economy of Populism," Journal of Economic Literature, American Economic Association, vol. 60(3), pages 753-832, September.
    35. Picault, Matthieu & Pinter, Julien & Renault, Thomas, 2022. "Media sentiment on monetary policy: Determinants and relevance for inflation expectations," Journal of International Money and Finance, Elsevier, vol. 124(C).
    36. Charles Goodhart & Rosa Lastra, 2018. "Populism and Central Bank Independence," Open Economies Review, Springer, vol. 29(1), pages 49-68, February.
    37. Friedrich Heinemann & Felix P. Huefner, 2004. "Is The View From The Eurotower Purely European? – National Divergence And Ecb Interest Rate Policy," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(4), pages 544-558, September.
    38. Tim Munday & James Brookes, 2021. "Mark my words: the transmission of central bank communication to the general public via the print media," Bank of England working papers 944, Bank of England.
    39. Joan Huang & John Simon, 2021. "Central Bank Communication: One Size Does Not Fit All," RBA Research Discussion Papers rdp2021-05, Reserve Bank of Australia.
    40. Ferrara, Federico Maria & Angino, Siria, 2022. "Does clarity make central banks more engaging? Lessons from ECB communications," European Journal of Political Economy, Elsevier, vol. 74(C).
    41. Tim Loughran & Bill Mcdonald, 2016. "Textual Analysis in Accounting and Finance: A Survey," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 54(4), pages 1187-1230, September.
    42. Vaubel, Roland, 1997. "The bureaucratic and partisan behavior of independent central banks: German and international evidence," European Journal of Political Economy, Elsevier, vol. 13(2), pages 201-224, May.
    43. ., 2002. "Monetary and fiscal policy and institutions in the European Monetary Union," Chapters, in: The European Monetary Union in a Public Choice Perspective, chapter 6, pages 123-147, Edward Elgar Publishing.
    44. Quinn, Dennis P. & Sattler, Thomas & Weymouth, Stephen, 2023. "Do Exchange Rates Influence Voting? Evidence from Elections and Survey Experiments in Democracies," International Organization, Cambridge University Press, vol. 77(4), pages 789-823, April.
    45. Michael Ehrmann & Marcel Fratzscher, 2007. "Communication by Central Bank Committee Members: Different Strategies, Same Effectiveness?," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 39(2‐3), pages 509-541, March.
    46. Korhonen, Iikka & Newby, Elisa, 2019. "Mastering Central Bank Communication Challenges via Twitter," BoF Economics Review 7/2019, Bank of Finland.
    47. Hobolt, Sara B. & de Vries, Catherine E., 2016. "Turning against the union? The impact of the crisis on the Eurosceptic vote in the 2014 European Parliament elections," LSE Research Online Documents on Economics 66831, London School of Economics and Political Science, LSE Library.
    48. Whitney Newey & Kenneth West, 2014. "A simple, positive semi-definite, heteroscedasticity and autocorrelation consistent covariance matrix," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 33(1), pages 125-132.
    49. Paul C. Tetlock, 2007. "Giving Content to Investor Sentiment: The Role of Media in the Stock Market," Journal of Finance, American Finance Association, vol. 62(3), pages 1139-1168, June.
    50. Donato Masciandaro & Francesco Passarelli, 2020. "Populism, Political Pressure and Central Bank (in)Dependence," Open Economies Review, Springer, vol. 31(3), pages 691-705, July.
    51. Gardt, Marius & Angino, Siria & Mee, Simon & Glöckler, Gabriel, 2022. "ECB Communication with the wider public," Economic Bulletin Articles, European Central Bank, vol. 8.
    52. Oriola, Hugo, 2023. "Political monetary cycles: An empirical study," European Journal of Political Economy, Elsevier, vol. 79(C).
    53. Martin Haselmayer & Marcelo Jenny, 2017. "Sentiment analysis of political communication: combining a dictionary approach with crowdcoding," Quality & Quantity: International Journal of Methodology, Springer, vol. 51(6), pages 2623-2646, November.
    54. Debus, Marc & Stegmaier, Mary & Tosun, Jale, 2014. "Economic Voting under Coalition Governments: Evidence from Germany," Political Science Research and Methods, Cambridge University Press, vol. 2(1), pages 49-67, April.
    55. Hamza Bennani & Matthias Neuenkirch, 2017. "The (home) bias of European central bankers: new evidence based on speeches," Applied Economics, Taylor & Francis Journals, vol. 49(11), pages 1114-1131, March.
    56. Tim Loughran & Bill Mcdonald, 2011. "When Is a Liability Not a Liability? Textual Analysis, Dictionaries, and 10‐Ks," Journal of Finance, American Finance Association, vol. 66(1), pages 35-65, February.
    57. William D. Nordhaus, 1975. "The Political Business Cycle," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 42(2), pages 169-190.
    58. Federico M. Ferrara & Donato Masciandaro & Manuela Moschella & Davide Romelli, 2021. "Political Voice on Monetary Policy: Evidence from the Parliamentary Hearings of the European Central Bank," BAFFI CAREFIN Working Papers 21159, BAFFI CAREFIN, Centre for Applied Research on International Markets Banking Finance and Regulation, Universita' Bocconi, Milano, Italy.
    59. Dewenter, Ralf & Linder, Melissa & Thomas, Tobias, 2019. "Can media drive the electorate? The impact of media coverage on voting intentions," European Journal of Political Economy, Elsevier, vol. 58(C), pages 245-261.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hugo Oriola & Matthieu Picault, 2023. "Opportunistic Political Central Bank Coverage: Does media coverage of ECB's Monetary Policy Impacts German Political Parties' Popularity?," Working Papers hal-04273091, HAL.
    2. Oriola, Hugo, 2023. "Political monetary cycles: An empirical study," European Journal of Political Economy, Elsevier, vol. 79(C).
    3. Maxime Menuet & Hugo Oriola & Patrick Villieu, 2024. "Do conservative central bankers weaken the chances of conservative politicians?," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 62(4), pages 681-738, June.
    4. Hugo Oriola, 2023. "Political monetary cycles: An empirical study," Post-Print hal-04648377, HAL.
    5. Jonne Lehtimäki & Marianne Palmu, 2022. "Who Should You Listen to in a Crisis? Differences in Communication of Central Bank Policymakers," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 11(3), pages 33-57.
    6. Baranowski, Paweł & Doryń, Wirginia & Łyziak, Tomasz & Stanisławska, Ewa, 2021. "Words and deeds in managing expectations: Empirical evidence from an inflation targeting economy," Economic Modelling, Elsevier, vol. 95(C), pages 49-67.
    7. Feldkircher, Martin & Hofmarcher, Paul & Siklos, Pierre L., 2024. "One money, one voice? Evaluating ideological positions of euro area central banks," European Journal of Political Economy, Elsevier, vol. 85(C).
    8. Picault, Matthieu & Renault, Thomas, 2017. "Words are not all created equal: A new measure of ECB communication," Journal of International Money and Finance, Elsevier, vol. 79(C), pages 136-156.
    9. Parle, Conor, 2022. "The financial market impact of ECB monetary policy press conferences — A text based approach," European Journal of Political Economy, Elsevier, vol. 74(C).
    10. Niţoi, Mihai & Pochea, Maria-Miruna & Radu, Ştefan-Constantin, 2023. "Unveiling the sentiment behind central bank narratives: A novel deep learning index," Journal of Behavioral and Experimental Finance, Elsevier, vol. 38(C).
    11. Alan S. Blinder & Michael Ehrmann & Jakob de Haan & David-Jan Jansen, 2024. "Central Bank Communication with the General Public: Promise or False Hope?," Journal of Economic Literature, American Economic Association, vol. 62(2), pages 425-457, June.
    12. Baumgärtner, Martin & Zahner, Johannes, 2025. "Whatever it takes to understand a central banker — Embedding their words using neural networks," Journal of International Economics, Elsevier, vol. 157(C).
    13. Mikael Apel & Marianna Blix Grimaldi & Isaiah Hull, 2022. "How Much Information Do Monetary Policy Committees Disclose? Evidence from the FOMC's Minutes and Transcripts," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 54(5), pages 1459-1490, August.
    14. Youngjoon Lee & Soohyon Kim & Ki Young Park, 2018. "Deciphering Monetary Policy Committee Minutes with Text Mining Approach: A Case of South Korea," Working papers 2018rwp-132, Yonsei University, Yonsei Economics Research Institute.
    15. Paul Hubert & Fabien Labondance, 2019. "Central bank tone and the dispersion of views within monetary policy committees," Working Papers hal-03403256, HAL.
    16. Baranowski, Pawel & Bennani, Hamza & Doryń, Wirginia, 2021. "Do the ECB's introductory statements help predict monetary policy? Evidence from a tone analysis," European Journal of Political Economy, Elsevier, vol. 66(C).
    17. Hubert, Paul & Labondance, Fabien, 2021. "The signaling effects of central bank tone," European Economic Review, Elsevier, vol. 133(C).
    18. Bohl, Martin T. & Kanelis, Dimitrios & Siklos, Pierre L., 2023. "Central bank mandates: How differences can influence the content and tone of central bank communication," Journal of International Money and Finance, Elsevier, vol. 130(C).
    19. Dimitrios Kanelis & Pierre L. Siklos, 2022. "Emotion in Euro Area Monetary Policy Communication and Bond Yields: The Draghi Era," CQE Working Papers 10322, Center for Quantitative Economics (CQE), University of Muenster.
    20. Andres Algaba & David Ardia & Keven Bluteau & Samuel Borms & Kris Boudt, 2020. "Econometrics Meets Sentiment: An Overview Of Methodology And Applications," Journal of Economic Surveys, Wiley Blackwell, vol. 34(3), pages 512-547, July.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • P35 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Public Finance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:203:y:2025:i:3:d:10.1007_s11127-024-01234-5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.