The influence of FOMC member characteristics on the monetary policy decision-making process

Smales, Lee A.; Apergis, N.

doi:10.1016/j.jbankfin.2015.12.002

Cited by 25 publications

(6 citation statements)

References 53 publications

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“…Our theory predicts that the effects of political variables on monetary outcomes will vary based on the level of economic uncertainty faced by the relevant actors. This is consistent with work that suggests that partisan effects are relevant for some eras more than others (e.g., Smales & Apergis, ). Ultimately, more work needs to be done to flesh out when and why political factors may influence economic outcomes through appointment channels.…”

Section: Resultssupporting

confidence: 91%

“…Some studies have found evidence that FOMC members appointed in times of Republican control pursue tighter (more conservative) monetary policy, in line with the expectations of the partisan model (e.g., Adolph, 2013;Chang, 2003;Havrilesky & Gildea, 1992;Morris, 2000). In contrast, other recent work fails to find significant evidence of partisan FOMC appointments (Eijffinger, Mahieu, & Raes, 2015) or finds that partisan effects are present in during the Great Recession but not in other recent eras (Smales & Apergis, 2016). Furthermore, Tempelman (2008) argues that hypotheses about politicization of the Federal Reserve (i.e.…”

Section: Introductionmentioning

confidence: 93%

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

Schnakenberg

Turner

Uribe-McGuire

2017

Economics & Politics

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We present a model of executive‐legislative bargaining over appointments to independent central 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.

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Section: Resultssupporting

confidence: 91%

Section: Introductionmentioning

confidence: 93%

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

Schnakenberg

Turner

Uribe-McGuire

2017

Economics & Politics

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show abstract

“…Our theory predicts that the effects of political variables on monetary outcomes will vary based on the level of economic uncertainty faced by the relevant actors. This is consistent with work that suggests that partisan effects are relevant for some eras more than others (e.g., Smales and Apergis, 2016). Ultimately, more work needs to be done to flesh out when and why political factors may influence economic outcomes through appointment channels.…”

Section: Discussionsupporting

confidence: 83%

“…Some studies have found evidence that FOMC members appointed in times of Republican control pursue tighter (more conservative) monetary policy, in line with the expectations of the partisan model (e.g., Adolph, 2013;Chang, 2003;Havrilesky and Gildea, 1992;Morris, 2000). In contrast, other recent work fails to find significant evidence of partisan FOMC appointments (Eijffinger, Mahieu and Raes, 2015) or finds that partisan effects are present in during the Great Recession but not in other recent eras (Smales and Apergis, 2016). Furthermore, Tempelman (2008) argues that hypotheses about politicization of the Federal Reserve (i.e.…”

mentioning

confidence: 97%

Allies or Commitment Devices? A Model of Appointments to the Federal Reserve

Schnakenberg¹,

Turner²,

Uribe-McGuire³

2021

Preprint

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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.

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“…Only recently have central bankers' biographical data also been more directly introduced into econometric analysis as explanatory factors and been recognised as a major scientific stake (Bordo and Istrefi 2018;Farvaque et al 2009Farvaque et al , 2011Göhlmann and Vaubel 2007;Smales and Apergis 2016). In highly quantitative terms and sometimes with contradicting findings, these studies support that a central banker's biographical background, such as gender and educational or professional background, has an impact on monetary policy.…”

Section: Empirical Sources Currently Used In Research On Central Bankersmentioning

confidence: 98%

Central Bankers as a Sociological Object: Stakes, Problems and Possible Solutions

Lebaron

Dogan

2020

Researching Elites and Power

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Central bankers can be defined as agents in charge of the decisions that are studied, developed and implemented within the central banks. These financial institutions have been both products and agents of nation-building and state formation (Cohen 1998; Feiertag and Margairaz 2016; Helleiner 1998), as well as that of the international diffusion of norms and structures (Krampf 2013; Marcussen 2005; Polillo and Guillén 2005). They are inserted and act in national and historical contexts, but they also share common functions (control of credit and money supply, banking and payment system supervision, reserve management, monetisation of budget deficit, collection and publication of data, etc.), objectives (price stability, macroeconomic and financial consistency), instruments (interest rates, open market operations, cash reserve ratio or other requirements and tools) and norms. Equipped with monopoly privileges such as issuing notes and acting as the final authority on monetary policy decisions, these institutions coordinate, in varying degrees, with governments. They also cooperate with each other as well as with regional, international and supranational decision-makers, some of which-such as the International Monetary Fund (IMF) and the Bank for International Settlements (BIS)-monitor and engage in policy coordination (Borio et al. 2008; Eichengreen et al. 2018; Toniolo 2005). In fact, in addition to being national policy-makers, central bankers have acquired a major role in the contemporary world economy and a central position in global governance (Baker 2006; Hall 2008). In comparison with other sectors of public policy, monetary decisions are, in general, clearly identified and highly formalised. Furthermore, they are characterised by a very high degree of centralisation of decision power in the hands of a few

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The influence of FOMC member characteristics on the monetary policy decision-making process

Cited by 25 publications

References 53 publications

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

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

Allies or Commitment Devices? A Model of Appointments to the Federal Reserve

Central Bankers as a Sociological Object: Stakes, Problems and Possible Solutions

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