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Central bank communication: fragmentation as an engine for limiting the publicity degree of information

Author

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  • Trabelsi, Emna

Abstract

In earlier theoretical framework, Morris and Shin (2002) highlight the potential dangers of transparency policy. In particular, public announcements may be detrimental to social welfare. Later, Morris and Shin (2005) uphold that more precise communication can degrade the signal value of prices. Researchers suggest reducing the precision of public information or withholding it. Cornand and Heinemann (2008) suggest rather limiting the publicity degree. We found that the same effect can be reached by establishing fragmented public information, but in presence of private signal.

Suggested Citation

  • Trabelsi, Emna, 2010. "Central bank communication: fragmentation as an engine for limiting the publicity degree of information," MPRA Paper 26647, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:26647
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    File URL: https://mpra.ub.uni-muenchen.de/26647/1/MPRA_paper_26647.pdf
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    References listed on IDEAS

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    1. Camille Cornand, 2006. "Speculative Attacks and Informational Structure: an Experimental Study," Review of International Economics, Wiley Blackwell, vol. 14(5), pages 797-817, November.
    2. George-Marios Angeletos & Alessandro Pavan, 2004. "Transparency of Information and Coordination in Economies with Investment Complementarities," American Economic Review, American Economic Association, vol. 94(2), pages 91-98, May.
    3. Camille Cornand & Frank Heinemann, 2008. "Optimal Degree of Public Information Dissemination," Economic Journal, Royal Economic Society, vol. 118(528), pages 718-742, April.
    4. Ehrmann, Michael & Fratzscher, Marcel, 2005. "Communication and decision-making by central bank committees: different strategies, same effectiveness?," Working Paper Series 488, European Central Bank.
    5. Stephen Morris & Hyun Song Shin, 2008. "Coordinating Expectations in Monetary Policy," Chapters,in: Central Banks as Economic Institutions, chapter 5 Edward Elgar Publishing.
    6. Ehrmann, Michael & Fratzscher, Marcel, 2007. "Social value of public information: testing the limits to transparency," Working Paper Series 821, European Central Bank.
    7. Stephen Morris & Hyun Song Shin, 2002. "Social Value of Public Information," American Economic Review, American Economic Association, vol. 92(5), pages 1521-1534, December.
    8. Stephen Morris & Hyun Song Shin, 2005. "Central Bank Transparency and the Signal Value of Prices," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 36(2), pages 1-66.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Hüning, Hendrik & Meub, Lukas, 2015. "Optimal public information dissemination: Introducing observational learning into a generalized beauty contest," Center for European, Governance and Economic Development Research Discussion Papers 260, University of Goettingen, Department of Economics.
    2. Hüning, Hendrik & Meub, Lukas, 2016. "Optimal public information dissemination: Introducing multiplier effects into a generalized beauty contest," Center for European, Governance and Economic Development Research Discussion Papers 260 [rev.], University of Goettingen, Department of Economics.
    3. Hüning, Hendrik & Meub, Lukas, 2015. "Optimal public information dissemination: Introducing observational learning into a generalized beauty contest," HWWI Research Papers 169, Hamburg Institute of International Economics (HWWI).

    More about this item

    Keywords

    transparency ; central bank communication ; semi public information ; private information ; coordination;

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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