Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/171516 
Authors: 
Year of Publication: 
2007
Series/Report no.: 
Economics Working Paper Series No. 07/73
Publisher: 
ETH Zurich, CER-ETH - Center of Economic Research, Zurich
Abstract: 
In this paper we examine a model where firms decide on the intensity of information acquisition about shocks. We analyze how the monetary policy framework impacts on the aggregate amount of information collected by firms. We show that it is socially beneficial to delegate monetary policy to a conservative central bank even if there are no incentives to push output above its long-run level. Transparency of central banks about economic shocks has ambiguous e ects on welfare. If an extreme level of opacity is feasible, it represents the social optimum. Otherwise full transparency may be a second-best solution.
Subjects: 
conservative central banker
optimal monetary policy
information
acquisition
Phillips curve
transparency
JEL: 
E58
E13
E12
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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