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The Economics of Central Banking

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Contemporary Economic Issues

Part of the book series: International Economic Association Series ((IEA))

Abstract

Since 1989, twenty-five countries in different parts of the world have upgraded the legal independence of their central banks very substantially.2 This trend is particularly remarkable in view of the fact that, during the preceding forty years, changes in central bank (CB) legislation were relatively rare.3 In parallel there has been a remarkable upsurge in both theoretical and empirical research on the meaning of central bank independence (CBI), its measurement, the interaction between government and the CB, the effect of CBI on the performance of the economy, the design of optimal contracts for central bankers, the functioning of nominal targets, and the deeper determinants of CBI. This chapter is a broad survey of recent developments in this rapidly growing area. It addresses central banking issues that are relevant for both developed and developing economies.

I would like to thank, without implication, Francesco Lippi, Robert Schanenborg, Yossi Spiegel, Lars Svensson and participants at the session on the economics of central banking of the Eleventh World Congress of the International Economic Association in Tunis, Tunisia.

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Authors and Affiliations

  1. Tel-Aviv University, Israel

    Alex Cukierman

  2. Tilburg University, The Netherlands

    Alex Cukierman

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  1. Alex Cukierman
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Holger C. Wolf

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© 1998 International Economic Association

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Cukierman, A. (1998). The Economics of Central Banking. In: Wolf, H.C. (eds) Contemporary Economic Issues. International Economic Association Series. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-26072-0_3

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