Abstract
In this chapter we argue that when it comes to present-day monetary theory and policy, economists suffer from myopia and are prone to herd behaviour. As a result, too many economists give too much weight to actual economic developments which can have an excessive impact on economic theory and policy.
“Conservatively dressed central bankers may not look like fashion victims, yet they are as prone to the latest craze as anybody else. Remember when monetarism was all the rage? Then central bank independence became the ‘in’ thing. The latest fashion is for inflation targets.“
The Economist, 25 September 1999
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Brakman, S., Garretsen, H., Hoogduin, L. (2001). Overconfidence in Monetary Theory and Monetary Policy. In: Kuper, G.H., Sterken, E., Wester, E. (eds) Coordination and Growth. Springer, Boston, MA. https://doi.org/10.1007/978-1-4615-1549-4_10
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DOI: https://doi.org/10.1007/978-1-4615-1549-4_10
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