Journal Description Editorial Committee How to Subscribe Forthcoming Articles Staff Papers Archive Copyright Information Research at the IMF Free Email Notification Receive emails when we post new
items of interest to you.
|
|
|
|
Central Bank Financial Strength, Transparency, and Policy Credibility Peter Stella Full Text of this Article (PDF 320K) Abstract: Although rarely
acknowledged explicitly, the financial strength of an independent and
credible central bank must be commensurate with its policy tasks and the
risks it faces. This paper explores the relationship between central bank
financial strength and policy outcomes, stressing the importance of financial
independence as a fundamental support to policy credibility. The attributes
of an adequate central bank capital policy are discussed and implications
drawn for the appropriate way in which central banks ought to be recapitalized.
Reasons why this issue has not been clearly analyzed in the past—primarily
owing to idiosyncratic and obscure central bank accounting—are also
presented. |
