Does Conservatism Matter? A Time Series Approach to Central Banking

Helge Berger () and Ulrich Woitek

Working Papers from Business School - Economics, University of Glasgow

Abstract: Rogoff’s "conservative central banker" has received a lot of attention recently. As a rule, central bank independence and inflation seem to be negatively correlated across countries. But the cross-country approach has been criticized for its reliance on legal measures and the measures’ possible endogeneity. We present an alternative test of whether conservatism in monetary policy matters based on generalized impulse response functions for the case of the German Bundesbank. It turns out that more conservative council majorities do indeed follow a more inflation-averse policy. We find the results very robust with regard to changes in the exchange rate regime, government/central bank conflicts, and the partisan composition of the government.

Keywords: Central Bank Independence; Conservative Central Banker; Monetary Policy; Conflicts; Generalized Impulse Responses (search for similar items in EconPapers)
JEL-codes: C32 E32 E58 E63 (search for similar items in EconPapers)
Date: 1999-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.gla.ac.uk/media/media_219053_en.pdf (application/pdf)

Related works:
Working Paper: Does Conservatism Matter? A Time Series Approach to Central Banking (1999)
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:gla:glaewp:9814

Access Statistics for this paper

More papers in Working Papers from Business School - Economics, University of Glasgow Contact information at EDIRC.
Bibliographic data for series maintained by Business School Research Team ().