Behavioral Monetary Policymaking: Economics, Political Economy and Psychology

Donato Masciandaro () and Davide Romelli

Chapter 9 in Behavioral Finance:The Coming of Age, 2019, pp 285-329 from World Scientific Publishing Co. Pte. Ltd.

Abstract: This chapter reviews the evolution of the theory of monetary policy design since the 1980s, highlighting the emerging role of central banker psychology. Three subsequent stages are evident. First, the central bank was considered as an independent institution (modern economics). Second, central bankers were assumed to be delegated bureaucrats (advanced political economy). Third, a link with psychology was established (behavioral economics).

Keywords: Behavioral Economics; Behavioral Finance; Behavioral Macro-Finance; Decision Making; Disposition Effect; Financial Crisis; Financial Decision-Making; Financial Market Anomalies; Fintech; Gender Differences; Heuristics; Information Processing Style; International Contagion Market Design; Monetary Policy; Mood; Optimal Portfolio; Overreaction; Peer-to-Peer Lending; Political Economics; Time Pressure; Transparency (search for similar items in EconPapers)
JEL-codes: G30 G41 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: BEHAVIORAL MONETARY POLICYMAKING: ECONOMICS, POLITICAL ECONOMY AND PSYCHOLOGY (2019)
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