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Dissent in Monetary Policy Decisions

  • RIBONI, Alessandro
  • RUGE-MURCIA, Francisco J.

Voting records indicate that dissents in monetary policy committees are frequent and predictability regressions show that they help forecast future policy decisions. In order to study whether the latter relation is causal, we construct a model of committee decision making and dissent where members' decisions are not a function of past dissents. The model is estimated using voting data from the Bank of England and the Riksbank. Stochastic simulations show that the decision-making frictions in our model help account for the predictive power of current dissents. The effect of institutional characteristics and structural parameters on dissent rates is examined using simulations as well.

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File URL: https://papyrus.bib.umontreal.ca/xmlui/handle/1866/6000
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Paper provided by Universite de Montreal, Departement de sciences economiques in its series Cahiers de recherche with number 2011-05.

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Length: 38 pages
Date of creation: 2011
Date of revision:
Handle: RePEc:mtl:montde:2011-05
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  6. RIBONI, Alessandro & RUGE-MURCIA, Francisco J., 2008. "Monetary Policy by Committee:Consensus, Chairman Dominance or Simple Majority?," Cahiers de recherche 2008-02, Universite de Montreal, Departement de sciences economiques.
  7. Francisco J. Ruge-Murcia, 2001. "Inflation Targeting Under Asymmetric Preferences," Banco de Espa�a Working Papers 0106, Banco de Espa�a.
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  11. Petra Gerlach-Kristen & Ellen E. Meade, 2010. "Is There a Limit on FOMC Dissents? Evidence from the Greenspan Era," Working Papers 2010-16, American University, Department of Economics.
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