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Estimating the Impact of Central Bank Independence upon Macroeconomic Performance using a Panel Data Model

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  • Dumiter, Florin Cornel

    (”Vasile Goldis” Western University of Arad, Faculty of Economic Sciences)

Abstract

This paper analyzes a new index for measuring central bank independence and inflation targeting in order to evaluate and assess the impact of central bank’s independence level upon the macroeconomic performance. The new index for measuring central bank independence and inflation targeting has three main pillars: central bank political and legal independence, central bank governance and conduct of monetary policy and central bank transparency and accountability. Moreover, the paper intends to evaluate the impact of central bank independence based on the new index upon some macroeconomic indicators, such as the inflation rate, the output, the unemployment rate, the budgetary deficit and the current account deficit.

Suggested Citation

  • Dumiter, Florin Cornel, 2011. "Estimating the Impact of Central Bank Independence upon Macroeconomic Performance using a Panel Data Model," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(4), pages 106-128, December.
    • Handle: RePEc:rjr:romjef:v::y:2011:i:4:p:106-128
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    References listed on IDEAS

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    1. repec:dgr:rugccs:200101 is not listed on IDEAS
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    7. Florin Cornel DUMITER, 2009. "Measuring Central Bank Independence and Inflation Targeting in Developed and Developing Countries," Timisoara Journal of Economics, West University of Timisoara, Romania, Faculty of Economics and Business Administration, vol. 2(2(6)), pages 83-100.
    8. Cukierman, Alex & Webb, Steven B & Neyapti, Bilin, 1992. "Measuring the Independence of Central Banks and Its Effect on Policy Outcomes," The World Bank Economic Review, World Bank, vol. 6(3), pages 353-398, September.
    9. Jan-Egbert Sturm & Jakob de Haan, 2001. "Inflation in Developing Countries: Does Central Bank Independence Matter?," CESifo Working Paper Series 511, CESifo.
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    Cited by:

    1. Ichiro Iwasaki & Akira Uegaki, 2017. "Central Bank Independence and Inflation in Transition Economies: A Comparative Meta-Analysis with Developed and Developing Economies," Eastern European Economics, Taylor & Francis Journals, vol. 55(3), pages 197-235, May.
    2. Athina Zervoyianni & Athanasios Anastasiou & Andreas Anastasiou, 2014. "Does central bank independence really matter? Re-assessing the role of the independence of monetary policy-makers in macroeconomic outcomes," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 8(4), pages 427-473.
    3. Stéphane Goutte & David Guerreiro & Bilel Sanhaji & Sophie Saglio & Julien Chevallier, 2019. "International Financial Markets," Post-Print halshs-02183053, HAL.

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    More about this item

    Keywords

    index of central bank independence and inflation targeting; central bank governance; central bank transparency and accountability; political and legal central bank independence; inflation rates; panel data;
    All these keywords.

    JEL classification:

    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • 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

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