Elements of Optimal Monetary Policy Committee Design

Author/Editor:

Jérôme Vandenbussche

Publication Date:

December 1, 2006

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The move from individual decision making to committee decision making is widely seen as a major evolution in contemporary central banking. This paper reviews the relevant economics and social psychology literatures with a view to providing some insights into the question of optimal monetary policy committee design. While the preference aggregation literature points to the effect of committee structure on the extent of the time inconsistency problem and its associated costs, the belief aggregation literature analyzes how different committee structures affect the efficiency of information pooling, the process of social influence, and collective accuracy. In conclusion, we highlight the main tradeoffs that the analysis has brought to light and point to directions for future research.

Series:

Working Paper No. 06/277

Subject:

Frequency:

Bimonthly

English

Publication Date:

December 1, 2006

ISBN/ISSN:

9781451865370/1018-5941

Stock No:

WPIEA2006277

Format:

Paper

Pages:

38

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