Monetary Policy Deliberations: Committee Size and Voting Rules

49 Pages Posted: 7 Jul 2012

See all articles by Vincent Maurin

Vincent Maurin

Swedish House of Finance

Jean-Pierre Vidal

European Central Bank (ECB)

Date Written: May 4, 2012

Abstract

How large should a monetary policy committee be? Which voting rule should a monetary policy committee adopt? This paper builds on Condorcet's jury threorem to analyse the relationships between committee size and voting rules in a model where policy discussions are subject to a time constraint. It suggests that in large committees majority voting is likely to enhance policy outcomes. Under unanimity (consensus) it is preferable to limit the size of the committee. Finally, supermajority voting rules are social contrivances that contribute to policy performance in a more uncertain environment, when initial policy proposals are less likely to be correct, or when payoffs are asymmetric.

Keywords: Collective decisionā€making, optimal committee sizing, deliberations, voting rules

JEL Classification: D71, D78, D81, E58

Suggested Citation

Maurin, Vincent and Vidal, Jean-Pierre, Monetary Policy Deliberations: Committee Size and Voting Rules (May 4, 2012). ECB Working Paper No. 1434, Available at SSRN: https://ssrn.com/abstract=2050890 or http://dx.doi.org/10.2139/ssrn.2050890

Vincent Maurin (Contact Author)

Swedish House of Finance ( email )

Drottninggatan 98
111 60 Stockholm
Sweden

Jean-Pierre Vidal

European Central Bank (ECB) ( email )

Sonnemannstrasse 22
Frankfurt am Main, 60314
Germany

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