Money talks

Marie Hoerova, Cyril Monnet and Ted Temzelides

Economics Letters, 2012, vol. 116, issue 3, 617-621

Abstract: We study credible information transmission by a benevolent short-lived central bank. When externalities create a wedge between private and social welfare, the central bank has an incentive to misreport its information. Information transmission through monetary policy creates a distortion, thus, lending credibility.

Keywords: Information; Interest rates; Monetary policy (search for similar items in EconPapers)
JEL-codes: D80 E40 E52 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (7)

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Working Paper: Money talks (2009)
Working Paper: Money talks (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:116:y:2012:i:3:p:617-621

DOI: 10.1016/j.econlet.2012.06.017

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