In this paper we estimate a model where in°ation, a measure of de facto central bank independence and an index of de facto exchange rate regime are simultaneously determined by a set of economic, political and institutional variables. De facto central bank independence is hampered by socio-political turbulence and bene¯ts from the balance of powers between the executive and the parliament. In°ation is explained by de facto central bank independence, by the level and volatility of public expenditure and by the de facto exchange rate regime. Openness (real and ¯nancial) a®ects in°ation through the ex- change rate regime channel. Success in controlling in°ation, in turn is crucial to sustain central bank independence and exchange rate stability.

Carmignani, F., Colombo, E., Tirelli, P. (2007). Socio-political and economic determinants of de facto monetary institutions and inflationary outcomes [Working paper del dipartimento].

Socio-political and economic determinants of de facto monetary institutions and inflationary outcomes

COLOMBO, EMILIO;TIRELLI, PATRIZIO
2007

Abstract

In this paper we estimate a model where in°ation, a measure of de facto central bank independence and an index of de facto exchange rate regime are simultaneously determined by a set of economic, political and institutional variables. De facto central bank independence is hampered by socio-political turbulence and bene¯ts from the balance of powers between the executive and the parliament. In°ation is explained by de facto central bank independence, by the level and volatility of public expenditure and by the de facto exchange rate regime. Openness (real and ¯nancial) a®ects in°ation through the ex- change rate regime channel. Success in controlling in°ation, in turn is crucial to sustain central bank independence and exchange rate stability.
Working paper del dipartimento
Scientifica
Infation; central bank independence; exchange rate regime; system estimation
English
Carmignani, F., Colombo, E., Tirelli, P. (2007). Socio-political and economic determinants of de facto monetary institutions and inflationary outcomes [Working paper del dipartimento].
Carmignani, F; Colombo, E; Tirelli, P
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10281/23135
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