Strategic central bank communication: discourse and game-theoretic analyses of the Bank of Japan's Monthly Report

Kohei Kawamura, Yohei Kobashi, Masato Shizume and Kozo Ueda

CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University

Abstract: We conduct a discourse analysis of the Bank of Japan's Monthly Report and examine its characteristics in relation to business cycles. We find that the difference between the number of positive and negative expressions in the reports leads the leading index of the economy by approximately three months, which suggests that the central bank' reports have some superior information about the state of the economy. Moreover, ambiguous expressions tend to appear more frequently with negative expressions. Using a simple persuasion game, we argue that the use of ambiguity in communication by the central bank can be seen as strategic information revelation when the central bank has an incentive to bias the reports (and hence beliefs in the market) upwards.

Keywords: Monetary policy; transparency; natural language processing; modality; latent Dirichlet allocation (LDA); verifiable disclosure model (search for similar items in EconPapers)
JEL-codes: D78 D82 E58 E61 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2016-03
New Economics Papers: this item is included in nep-cba, nep-gth, nep-mac and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://cama.crawford.anu.edu.au/sites/default/fil ... shi_shizume_ueda.pdf (application/pdf)

Related works:
Working Paper: Strategic Central Bank Communication: Discourse and Game-Theoretic Analyses of the Bank of Japan's Monthly Report (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:een:camaaa:2016-11

Access Statistics for this paper

More papers in CAMA Working Papers from Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University Contact information at EDIRC.
Bibliographic data for series maintained by Cama Admin ().