Svensson (2006) argues that Morris and Shin (2002) is, contrary to what is claimed, pro-transparency. This paper reexamines the issue but with an important modification to the original Morris and Shin framework. Recognizing that central banks impact the economy not only indirectly via public announcements, but also directly through policy actions, we consider the social value of public information in the presence of active policy intervention. Our results strengthen Morris and Shin's conclusions considerably: in particular, we find that public disclosure of the central bank's information is unambiguously, i.e., regardless of parameter values, undesirable. (JEL D82, D83, E52, E58)

The paper examines the appropriate design of central banking institutions in an economy in which the nominal wage is set by an in¯ation-averse monopoly union as a positive mark-up over its market-clearing value. The analysis considers both the optimal choice of central banker and the potential role for a linear in¯ation contract. The optimal set of arrangements is a central banker who attaches less signi®cance to in¯ation than does society, combined with an in¯ation contract where the value of the contract parameter is related to the union's degree of in¯ationaversion.

This paper examines the welfare implications of public information dissemination within a model in which information is heterogeneous across agents and where a strategic complementarity is present. The focus of the analysis is on how the presence of stabilization policy affects the case for transparency. In considering this issue, it extends James and Lawler's (2011) contribution by incorporating an alternative payoff function and by employing a different representation of public disclosure. The study's key finding is that the conclusions drawn in its precursor are robust to these modifications; specifically, in the presence of optimally designed policy intervention zero transparency maximizes welfare.

No abstract