Allies or commitment devices? A model of appointments to the Federal Reserve

Autor: Ian R. Turner, Keith E. Schnakenberg, Alicia Uribe
Rok vydání: 2017
Předmět:
Economics and Econometrics
SocArXiv|Social and Behavioral Sciences|Political Science|American Politics
bepress|Social and Behavioral Sciences|Economics
bepress|Social and Behavioral Sciences|Political Science|Models and Methods
bepress|Social and Behavioral Sciences|Economics|Political Economy
Face (sociological concept)
SocArXiv|Social and Behavioral Sciences|Political Science
Ideal (ethics)
bepress|Social and Behavioral Sciences|Political Science
bepress|Social and Behavioral Sciences|Political Science|American Politics
Market economy
Spatial model
0502 economics and business
050602 political science & public administration
Economics
050207 economics
Economic uncertainty
Theory
SocArXiv|Social and Behavioral Sciences|Economics|Political Economy
05 social sciences
Monetary policy
SocArXiv|Social and Behavioral Sciences|Economics
Limiting
0506 political science
SocArXiv|Social and Behavioral Sciences|Political Science|Models and Methods
Central bank
Political economy
bepress|Social and Behavioral Sciences
SocArXiv|Social and Behavioral Sciences
Zdroj: Economics & Politics. 29:118-132
ISSN: 1468-0343
0954-1985
DOI: 10.1111/ecpo.12089
Popis: We present a model of executive-legislative bargaining over appointments to independent cen-tral banks in the face of an uncertain economy with strategic economic actors. The model highlights the contrast between two idealized views of Federal Reserve appointments. In one view, politicians prefer to appoint conservatively biased central bankers to overcome credible commitment problems that arise in monetary policy. In the other, politicians prefer to appoint allies, and appointments are well described by the spatial model used to describe appointments to other agencies. Both ideals are limiting cases of our model, which depend on the level of economic uncertainty. When economic uncertainty is extremely low, politicians prefer very conservative appointments. When economic uncertainty increases, politicians’ prefer central bank appointees closer to their own ideal points. In the typical case, the results are somewhere in between: equilibrium appointments move in the direction of politician’s preferences but with a moderate conservative bias.
Databáze: OpenAIRE
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