Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/37158
Authors: 
Hefeker, Carsten
Zimmer, Blandine
Year of Publication: 
2010
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2010: Ökonomie der Familie - Session: Monetary Policy Rules and Institutions B16-V3
Abstract: 
This paper revisits the trade-off between central bank independence and conservatism using a New Keynesian model with uncertainty about the central banker's output gap target. It is shown that when this uncertainty is high, the trade-off no longer holds. In this case, the optimal combination between independence and conservatism is characterised by complementarity.
Subjects: 
Central bank independence
Conservatism
Transparency of monetary policy
JEL: 
E52
E58
F33
Document Type: 
Conference Paper

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