Cookies?
Library Header Image
LSE Research Online LSE Library Services

Transparency and deliberation within the FOMC: a computational linguistics approach

Hansen, Stephen, McMahon, Michael and Prat, Andrea (2014) Transparency and deliberation within the FOMC: a computational linguistics approach. CFM discussion paper series (CFM-DP2014-11). Centre For Macroeconomics, London, UK.

[img]
Preview
PDF
Download (3MB) | Preview

Abstract

How does transparency, a key feature of central bank design, affect the deliberation of monetary policymakers? We exploit a natural experiment in the Federal Open Market Committee in 1993 together with computational linguistic models (particularly Latent Dirichlet Allocation) to measure the effect of increased transparency on debate. Commentators have hypothesized both a beneficial discipline effect and a detrimental conformity effect. A difference-in-differences approach inspired by the career concerns literature uncovers evidence for both effects. However, the net effect of increased transparency appears to be a more informative deliberation process.

Item Type: Monograph (Discussion Paper)
Official URL: http://www.centreformacroeconomics.ac.uk/Home.aspx
Additional Information: © 2014 The Authors
Divisions: Centre for Macroeconomics
Subjects: H Social Sciences > HG Finance
JEL classification: D - Microeconomics > D7 - Analysis of Collective Decision-Making > D78 - Positive Analysis of Policy-Making and Implementation
E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy (Targets, Instruments, and Effects)
E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies
Sets: Collections > Economists Online
Research centres and groups > Centre for Macroeconomics
Date Deposited: 22 Jul 2014 08:47
Last Modified: 20 Feb 2019 03:47
Funders: Research Donations Committee, Bank of England
URI: http://eprints.lse.ac.uk/id/eprint/58072

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics