The Political Economy of Inflation, Labour Market Distortions and Central Bank Independence
Bibliographic Data
| ID | 9716927 |
|---|---|
| Authors | Berthold Herrendorf (0000-0002-7177-4156, Universidad Carlos III de Madrid, University of Southampton and CEPR Universität Bonn), Manfred J M Neumann (Universidad Carlos III de Madrid, University of Southampton and CEPR Universität Bonn) |
| Year | 2003 |
| Volume | 113 |
| Issue | 484 |
| Pages | 43-64 |
| Publication date | 2003-01-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | The Economic Journal (JOURNAL) |
| Journal identifiers | ISSN: 0013-0133 • E-ISSN: 1468-0297 |
| Publisher | Oxford University Press (OUP) (PUBLISHER) |
| DOI | 10.1111/1468-0297.00088 |
| OpenAlex | W2050238558 |
| Language | EN |
| References cited | 31 |
Using the citizen–candidate model we study the government’s choice of institutions for the labour market and the central bank and derive the implications for inflation and employment. We derive conditions for the existence of equilibria in which the labour market is distorted and the central bank is dependent or independent under a range of conditions affecting central bank dependence, the post–election cycle in inflation and employment and inflation bias. Our results imply that average inflation and inflation variability are lower under an independent central bank whereas employment variability can be lower or higher, consistent with evidence for OECD countries
Central bank · Economic history · Economics · Economy · Independence (probability theory · Inflation (cosmology · Keynesian economics · Monetary policy · Political science · Politics · Economic Theory and Policy · Fiscal Policies and Political Economy · Fiscal Policy and Economic Growth · Law
Political Cycles and the Macroeconomy
The Making of Economic Policy
Political and Monetary Institutions and Public Financial Policies in the Industrial Countries
An Economic Model of Representative Democracy
A Model of Political Competition with Citizen-Candidates
Elections and Macroeconomic Policy Cycles
Central Bank Independence and Macroeconomic Performance
A Theory of Ambiguity, Credibility, and Inflation under Discretion and Asymmetric Information
The Optimal Degree of Commitment to an Intermediate Monetary Target
Macroeconomic Policy in a Two-Party System as a Repeated Game
Rules Rather than Discretion
A Positive Theory of Monetary Policy in a Natural Rate Model
Optimal Inflation Contracts and Inflation Targets with Uncertain Central Bank Preferences
| Citation velocity | historical |
|---|---|
| Highly cited | No |