Scholarly Comments on Academic Economics

“Credibility” in Context: Do Central Bankers and Economists Interpret the Term Differently?

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*James Forder* is Fellow and Tutor in Economics at Balliol College, Oxford, Lecturer in Politics at Oxford University, a Managing Editor of _Oxford Economic Papers_, and a member of the Bar of England and Wales. He has written a number of papers critical

Abstract

The idea that the ‘credibility’ of monetary policy is important receives almost universal assent. But the word can mean very different things in different contexts. In particular, the meaning that it has been given by the work of Robert Barro and David Gordon is a very special one. It should not be presumed that in ordinary discussion of ‘credibility’ theirs is always the meaning people have in mind. Consequently, Alan Blinder’s survey on attitudes to ‘credibility’, which failed to specify what he meant by the term, might be most misleading, and if unwarranted inferences are not to be drawn a most careful interpretation of it is required.

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Volume (Issue)
Pages
413-426
Published
JEL classification
B40, E52, E58
Keywords
credibility, central bank independence
Article Downloads (all formats)
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