Measures of Central Bank Autonomy: Empirical Evidence for OECD, Developing, and Emerging Market Economies

Segalotto, Jean-Francois, Marco Arnone () and Bernard Laurens

No 06/228, IMF Working Papers from International Monetary Fund

Abstract: This paper presents an update of the Grilli-Masciandaro-Tabellini (GMT) index of central bank (CB) autonomy, based on CB legislation as of end-2003. The index is applied to a set of OECD and developing countries, and emerging market economies. For a smaller set of countries, the paper presents a reconstruction of the GMT index based on Cukierman (1992) and assesses changes in CB autonomy between 1992 and 2003. The results point to a significant increase in CB autonomy, in particular for developing countries. In most cases, this improvement has involved a three-stage process: an initial stage in which the political foundations for CB autonomy are laid; a second stage in which operational autonomy develops; and a final stage in which CBs gain further political autonomy in terms of policy formulation and the appointment of senior management.

Keywords: Central bank autonomy; political autonomy; economic autonomy; Central banks; Governance; Monetary policy; Developed countries; Developing countries; Emerging markets (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-mon and nep-pol
Date: Written
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