An Argument in Favor of Long Terms for Central Bankers
12 Pages Posted: 3 Jul 2013
Date Written: July 1, 2013
We draw on the canonical New Keynesian model to assess the consequences of the central bankers’ term length for the government’s appointment decision. We show that longer terms induce the government to appoint more conservative central bankers, which is conducive to welfare.
Keywords: term length, conservative central banker, New Keynesian model
JEL Classification: E58
Suggested Citation: Suggested Citation