Abstract

http://ssrn.com/abstract=895460
 
 

References (33)



 
 

Citations (53)



 


 



Does Central Bank Transparency Reduce Interest Rates?


Petra M. Geraats


University of Cambridge - Faculty of Economics and Politics; CESifo (Center for Economic Studies and Ifo Institute)

Sylvester C. W. Eijffinger


Tilburg University (CentER) - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Carin Van der Cruijsen


De Nederlandsche Bank

February 2006

CentER Discussion Paper No. 2006-11

Abstract:     
Central banks have become increasingly transparent during the last decade. One of the main benefits of transparency predicted by theoretical models is that it enhances the credibility, reputation, and flexibility of monetary policy, which suggests that increased transparency should result in lower nominal interest rates. This paper exploits a detailed transparency data set to investigate this relationship for eight major central banks. It appears that for all central banks, the level of interest rates is affected by the degree of central bank transparency. In particular, the majority of the improvements in transparency are associated with significant effects on interest rates, controlling for economic conditions. In most of these cases, interest rates are lower, often by around 50 basis points, although in some instances transparency appears to have had a detrimental effect on interest rates.

Number of Pages in PDF File: 54

Keywords: central bank transparency, monetary policy, interest rates

JEL Classification: E52, E58

working papers series





Download This Paper

Date posted: April 17, 2006  

Suggested Citation

Geraats, Petra M. and Eijffinger, Sylvester C. W. and Cruijsen, Carin van der, Does Central Bank Transparency Reduce Interest Rates? (February 2006). Available at SSRN: http://ssrn.com/abstract=895460 or http://dx.doi.org/10.2139/ssrn.895460

Contact Information

Petra Geraats (Contact Author)
University of Cambridge - Faculty of Economics and Politics ( email )
Austin Robinson Building
Sidgwick Avenue
Cambridge, CB3 9DD
United Kingdom
+44 1223 335 295 (Phone)
+44 1223 335 475 (Fax)
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
Sylvester C. W. Eijffinger
Tilburg University (CentER) - Department of Economics ( email )
P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 2411 (Phone)
+31 13 466 3042 (Fax)
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Carin Van der Cruijsen
De Nederlandsche Bank ( email )
PO Box 98
1000 AB Amsterdam
Amsterdam, 1000 AB
Netherlands
HOME PAGE: http://www.dnb.nl/en/onderzoek-2/onderzoekers/overzicht-persoonlijke-paginas/index.jsp

Feedback to SSRN


Paper statistics
Abstract Views: 754
Downloads: 135
Download Rank: 129,033
References:  33
Citations:  53

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo1 in 0.344 seconds