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Optimal Structure of Monetary Policy Committees


  • Keiichi Morimoto

    () (Graduate School of Economics, Osaka University)


This paper explores an optimal personnel organization problem of monetary policy committees. First, I construct an analytically tractable model for monetary policy analysis which starts from decision-making in the monetary policy committee. Using the model, I investigate the relationship between preference heterogeneity among the committee members and the optimal structure of the monetary policy committee. The result shows that it is optimal in general cases to appoint not only inflation-minded (hawkish) persons but also output-minded (dovish) persons. This is a theoretical justification for the fact that the actual monetary policy committees (e.g., MPC of Bank of England and FOMC) usually consist of both type members as the empirical researches suggest. It also explains why the committees have replaced the single policy makers in the actual central banks.

Suggested Citation

  • Keiichi Morimoto, 2009. "Optimal Structure of Monetary Policy Committees," Discussion Papers in Economics and Business 09-36-Rev, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), revised Dec 2009.
  • Handle: RePEc:osk:wpaper:0936r

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    References listed on IDEAS

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    6. Mihov, Ilian & Sibert, Anne, 2006. "Credibility and Flexibility with Independent Monetary Policy Committees," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 38(1), pages 23-46, February.
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    More about this item


    monetary policy; committee; delegation; imperfect information; higher order expectations;

    JEL classification:

    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
    • 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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