Optimal central banker contracts and common agency: a comment
Tóm tắt
We explore a setting where the central bank is offered an incentive scheme by an interest group, in addition to the contract designed by the government. We prove that the inflation bias can be eliminated when principals do not cooperate and have different output or inflation objectives. These conclusions contrast with those of Chortareas and Miller (Public Choice 121:131–155, 2004). The reason is that our analysis takes into account the participation constraints of the central bank. We also show that, if principals cooperate, the inflation bias is eliminated when their output target is different but not when they disagree over the inflation objective.
Tài liệu tham khảo
Campoy, J. C., & Negrete, J. C. (2008). Optimal central banker contracts and common agency: a comment. http://juanc.negrete.googlepages.com/APorEllLink.pdf.
Candel-Sanchez, F., & Campoy-Miñarro, J. C. (2004). Is the Walsh contract really optimal? Public Choice, 120, 29–39.
Chappell, H. W., McGregor, R. R., & Vermilyea, T. A. (2005). Committee decisions on monetary policy. Cambridge: MIT Press.
Chortareas, G. E., & Miller, S. M. (2004). Optimal central banker contracts and common agency. Public Choice, 121, 131–155.
Chortareas, G. E., & Miller, S. M. (2007). The Walsh contract for central bankers proves optimal after all! Public Choice, 131, 243–247.
Svensson, L. (1997). Optimal inflation targets, conservative central bank, and linear inflation contracts. American Economic Review, 87, 98–114.
Walsh, C. E. (1995). Optimal contracts for independent central bankers. American Economic Review, 85, 150–167.