Monetary policy transparency: transparent about what?
This paper puts the issue of monetary policy transparency into a broad economic perspective. In so doing, it narrows the focus from that which frequently appears in this literature. The analysis is predicated on the assertion that the sole economic argument for transparency is policy effectiveness-transparency is desirable if it enhances the effectiveness of policy and is not, if it does not. In cases where transparency neither enhances nor impairs the effectiveness of policy, the case for transparency can be argued on non-economic grounds. This analysis has implications for several policy/transparency issues. Important among these is the assumption in this literature that inflation and output must be viewed by policymakers as substitutes. I suggest that policymakers might generate a better inflation/output outcome if they thought of inflation and output objectives as complements rather than substitutes.
|Date of creation:||2003|
|Date of revision:|
|Publication status:||Published in The Manchester School, September 2003, 71(5), pp. 478-97|
|Contact details of provider:|| Postal: |
Web page: http://www.stlouisfed.org/
More information through EDIRC
|Order Information:|| Email: |
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.:
- Taylor, John B., 1993. "Discretion versus policy rules in practice," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 195-214, December.
- Daniel L. Thornton, 2000. "Money in a theory of exchange," Review, Federal Reserve Bank of St. Louis, issue Jan, pages 35-60.
- Winkler, Bernhard, 2000. "Which kind of transparency? On the need for clarity in monetary policy-making," Working Paper Series 0026, European Central Bank.
- Sarno, Lucio & Thornton, Daniel L, 2002.
"The Dynamic Relationship Between the Federal Funds rate and the Treasury Bill Rate: An Empirical Investigation,"
CEPR Discussion Papers
3225, C.E.P.R. Discussion Papers.
- Sarno, Lucio & Thornton, Daniel L., 2003. "The dynamic relationship between the federal funds rate and the Treasury bill rate: An empirical investigation," Journal of Banking & Finance, Elsevier, vol. 27(6), pages 1079-1110, June.
- Lucio Sarno & Daniel L. Thornton, 2002. "The dynamic relationship between the federal funds rate and the Treasury bill rate: an empirical investigation," Working Papers 2000-032, Federal Reserve Bank of St. Louis.
- Henrik Jensen, .
"Optimal Degrees of Tranaparency in Monetary Policymaking,"
EPRU Working Paper Series
01-01, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Jensen, Henrik, 2002. " Optimal Degrees of Transparency in Monetary Policymaking," Scandinavian Journal of Economics, Wiley Blackwell, vol. 104(3), pages 399-422, September.
- Jensen, Henrik, 2001. "Optimal Degrees of Transparency in Monetary Policymaking," CEPR Discussion Papers 2689, C.E.P.R. Discussion Papers.
- Jensen, Henrik, 2001. "Optimal degrees of transparency in monetary policymaking," Discussion Paper Series 1: Economic Studies 2001,04, Deutsche Bundesbank, Research Centre.
- Thornton, Daniel L., 2005.
"Tests of the expectations hypothesis: Resolving the anomalies when the short-term rate is the federal funds rate,"
Journal of Banking & Finance,
Elsevier, vol. 29(10), pages 2541-2556, October.
- Daniel L. Thornton, 2004. "Tests of the expectations hypothesis: resolving the anomalies when the short-term rate is the federal funds rate," Working Papers 2000-003, Federal Reserve Bank of St. Louis.
- Eijffinger, S.C.W. & Geraats, P., 2006.
"How transparent are central banks?,"
Other publications TiSEM
b34dfb1f-520f-4787-a08f-5, Tilburg University, School of Economics and Management.
- Eijffinger, S.C.W. & Geraats, P.M., 2004. "How Transparent Are Central Banks?," Cambridge Working Papers in Economics 0411, Faculty of Economics, University of Cambridge.
- Eijffinger, Sylvester C W & Geraats, Petra M, 2002. "How Transparent are Central Banks?," CEPR Discussion Papers 3188, C.E.P.R. Discussion Papers.
- W.H. Buiter, 1999.
"Alice in Euroland,"
CEP Discussion Papers
dp0423, Centre for Economic Performance, LSE.
- Geraats, Petra Maria, 2001. "Precommitment, Transparency and Monetary Policy," Discussion Paper Series 1: Economic Studies 2001,12, Deutsche Bundesbank, Research Centre.
- Bennett T. McCallum, 2001.
"Monetary policy analysis in models without money,"
Federal Reserve Bank of St. Louis, issue Jul, pages 145-164.
- Daniel L. Thornton, 1996. "The costs and benefits of price stability: an assessment of Howitt's rule," Review, Federal Reserve Bank of St. Louis, issue Mar, pages 23-38.
- Daniel L. Thornton, 1982. "Simple analytics of the money supply process and monetary control," Review, Federal Reserve Bank of St. Louis, issue Oct, pages 22-39.
- Sargent, Thomas J & Wallace, Neil, 1975. ""Rational" Expectations, the Optimal Monetary Instrument, and the Optimal Money Supply Rule," Journal of Political Economy, University of Chicago Press, vol. 83(2), pages 241-54, April.
- Cukierman, Alex, 2001.
"Are Contemporary Central Banks Transparent about Economic Models and Objectives and What Difference Does it Make?,"
Discussion Paper Series 1: Economic Studies
2001,05, Deutsche Bundesbank, Research Centre.
- Alex Cukierman, 2002. "Are contemporary central banks transparent about economic models and objectives and what difference does it make?," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 15-36.
- Svensson, Lars E O, 2002. "The Inflation Forecast and the Loss Function," CEPR Discussion Papers 3365, C.E.P.R. Discussion Papers.
- William Poole, 2002. "Inflation, recession and Fed policy," Speech 46, Federal Reserve Bank of St. Louis.
- repec:ner:tilbur:urn:nbn:nl:ui:12-88701 is not listed on IDEAS
- Michael Woodford, 2001.
"Monetary policy in the information economy,"
Proceedings - Economic Policy Symposium - Jackson Hole,
Federal Reserve Bank of Kansas City, pages 297-370.
- Petra M. Geraats, 2002. "Central Bank Transparency," Economic Journal, Royal Economic Society, vol. 112(483), pages 532-565, November.
- James Bullard, 1998. "Trading trade-offs?," National Economic Trends, Federal Reserve Bank of St. Louis, issue Dec.
- Benjamin M. Friedman, 2002. "The Use and Meaning of Words in Central Banking: Inflation Targeting, Credibility, and Transparency," NBER Working Papers 8972, National Bureau of Economic Research, Inc.
- Alvin L. Marty & Daniel L. Thornton, 1995. "Is there a case for "moderate" inflation?," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 27-38.
When requesting a correction, please mention this item's handle: RePEc:fip:fedlwp:2002-028. 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: (Anna Xiao)
If references are entirely missing, you can add them using this form.