Monetary policy deliberations: committee size and voting rules
How large should a monetary policy committee be? Which voting rule should a monetary policy committee adopt? This paper builds on Condorcet's jury threorem to analyse the relationships between committee size and voting rules in a model where policy discussions are subject to a time constraint. It suggests that in large committees majority voting is likely to enhance policy outcomes. Under unanimity (consensus) it is preferable to limit the size of the committee. Finally, supermajority voting rules are social contrivances that contribute to policy performance in a more uncertain environment, when initial policy proposals are less likely to be correct, or when payoffs are asymmetric. JEL Classification: D71, D78, D81, E58
|Date of creation:||May 2012|
|Date of revision:|
|Contact details of provider:|| Postal: 60640 Frankfurt am Main, Germany|
Phone: +49 69 1344 0
Fax: +49 69 1344 6000
Web page: http://www.ecb.europa.eu/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Blinder, Alan S., 2007.
"Monetary policy by committee: Why and how?,"
European Journal of Political Economy,
Elsevier, vol. 23(1), pages 106-123, March.
- Alessandro Riboni & Francisco J. Ruge-Murcia, 2008.
"Preference Heterogeneity in Monetary Policy Committees,"
International Journal of Central Banking,
International Journal of Central Banking, vol. 4(1), pages 213-233, March.
- Alessandro Riboni & Francisco Ruge-Murcia, 2007. "Preference heterogeneity in monetary policy committees," DNB Working Papers 157, Netherlands Central Bank, Research Department.
- RIBONI, Alessandro & RUGE-MURCIA, Francisco J., 2007. "Preference Heterogeneity in Monetary Policy Committees," Cahiers de recherche 05-2007, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
- RIBONI, Alessandro & RUGE-MURCIA, Francisco J., 2007. "Preference Heterogeneity in Monetary Policy Committees," Cahiers de recherche 2007-05, Universite de Montreal, Departement de sciences economiques.
- Farvaque, Etienne & Matsueda, Norimichi & Méon, Pierre-Guillaume, 2009.
"How monetary policy committees impact the volatility of policy rates,"
Journal of Macroeconomics,
Elsevier, vol. 31(4), pages 534-546, December.
- Etienne Farvaque & Norimichi Matsueda & Pierre-Guillaume Méon, 2008. "How monetary policy committees impact the volatility of policy rates," Working Papers CEB 08-026.RS, ULB -- Universite Libre de Bruxelles.
- Stephen Hansen & Michael McMahon, 2011.
"How Experts Decide: Identifying Preferences versus Signals from Policy Decisions,"
CEP Discussion Papers
dp1063, Centre for Economic Performance, LSE.
- Hansen, Stephen & McMahon, Michael, 2011. "How Experts Decide : Identifying Preferences versus Signals from Policy Decisions," The Warwick Economics Research Paper Series (TWERPS) 963, University of Warwick, Department of Economics.
- Timothy Besley & Neil Meads & Paolo Surico, 2008.
"Insiders versus Outsiders in Monetary Policymaking,"
American Economic Review,
American Economic Association, vol. 98(2), pages 218-23, May.
- Timothy Besley & Neil Meads & Paolo Surico, 2008. "Insiders versus outsiders in monetary policymaking," LSE Research Online Documents on Economics 33743, London School of Economics and Political Science, LSE Library.
- Besley, Timothy & Meads, Neil & Surico, Paolo, 2007. "Insiders versus Outsiders in Monetary Policy-Making," Discussion Papers 20, Monetary Policy Committee Unit, Bank of England.
- Arnab Bhattacharjee & Sean Holly, 2013.
"Understanding Interactions in Social Networks and Committees,"
Spatial Economic Analysis,
Taylor & Francis Journals, vol. 8(1), pages 23-53, March.
- Bhattacharjee, A. & Holly, S., 2010. "Understanding Interactions in Social Networks and Committees," Cambridge Working Papers in Economics 1003, Faculty of Economics, University of Cambridge.
- Bhattacharjee, Arnab & Holly, Sean, 2009. "Understanding Interactions in Social Networks and Committees," SIRE Discussion Papers 2009-53, Scottish Institute for Research in Economics (SIRE).
- Arnab Bhattacharjee & Sean Holly, 2010. "Understanding Interactions in Social Networks and Committees," CDMA Working Paper Series 201004, Centre for Dynamic Macroeconomic Analysis.
- Bauke Visser & Otto H. Swank, 2005.
"On Committees of Experts,"
Tinbergen Institute Discussion Papers
05-028/1, Tinbergen Institute.
- Petra Gerlach-Kristen, 2008. "The Role of the Chairman in Setting Monetary Policy: Individualistic vs. Autocratically Collegial MPCs," International Journal of Central Banking, International Journal of Central Banking, vol. 4(3), pages 119-143, September.
- Alan Kirman, 1993. "Ants, Rationality, and Recruitment," The Quarterly Journal of Economics, Oxford University Press, vol. 108(1), pages 137-156.
- repec:dau:papers:123456789/7717 is not listed on IDEAS
- Gerardi, Dino & Yariv, Leeat, 2007. "Deliberative voting," Journal of Economic Theory, Elsevier, vol. 134(1), pages 317-338, May.
- Christopher Spencer, 2005. "Consensus Formation in Monetary Policy Committees," School of Economics Discussion Papers 1505, School of Economics, University of Surrey.
- Jan Marc Berk & Beata K. Bierut, 2003. "Committee structure and its implications for Monetary policy decision-making," MEB Series (discontinued) 2003-05, Netherlands Central Bank, Monetary and Economic Policy Department.
- Carl Andreas Claussen & Øistein Røisland, 2010.
"The discursive dilemma in monetary policy,"
2010/05, Norges Bank.
- Jan Marc Berk & Beata K. Bierut, 2005. "Communication in Monetary Policy Committees," DNB Working Papers 059, Netherlands Central Bank, Research Department.
- Berk, Jan Marc & Bierut, Beata K., 2011. "Communication in a monetary policy committee," European Journal of Political Economy, Elsevier, vol. 27(4), pages 791-801.
- Gerlach-Kristen, Petra, 2005. "Too little, too late: Interest rate setting and the costs of consensus," Economics Letters, Elsevier, vol. 88(3), pages 376-381, September.
- Keiichi Morimoto, 2010. "Coordination Behavior and Optimal Committee Size," Discussion Papers in Economics and Business 10-02, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
- Philippe Moutot & Alexander Jung & Francesco Paolo Mongelli, 2008. "The working of the eurosystem - monetary policy preparations and decision-making – selected issues," Occasional Paper Series 79, European Central Bank.
When requesting a correction, please mention this item's handle: RePEc:ecb:ecbwps:20121434. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Official Publications)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.