1、中文 3950 字 外文 原文 International Monetary and Financial Arrangements: Present and Future 3. National economic policies under the present international monetary system In this part, we examine central bank independence and monetary and fiscal policies under the present international monetary system. We
2、also examine global financial integration and the effectiveness of monetary policy. 3.1. Central bank independence In recent years, many nations have passed laws removing government control on their central bank (i.e., making their central bank more independent) in order to overcome the inflationary
3、 bias that was otherwise believed to exist in the conduct of monetary policy. The central banks of some nations, such as Switzerland and Germany, have enjoyed a high degree of independence during most of the postwar period. Recently, Canada, Chile, and New Zealand enacted legislation to make their c
4、entral banks more independent. In May 1997, England also did so. A common ingredient of economic reforms in Latin America and in the ex-communist nations of Central and Eastern Europe has been the creation of independent central banksat least legallyif not yet in their actual day-to-day operation. T
5、he Maastricht Treaty prohibits central banks from taking instructions from the government, as one of the requirements for monetary union in Europe. To ensure central bank independence, the Treaty also requires that central bank governors be appointed for a term of at least five years. More important
6、ly, the Treaty forbids central banks from purchasing debt instruments directly from the government and from providing credit facilities to the government. This is done in the belief that a central bank that is free from political pressure would achieve a lower inflation rate. But what is meant by ce
7、ntral bank independence? Fisher (1995) introduced the distinction between goal independence and instrument independence. A central bank has goal independence if it can set its own goals, such as the rate of inflation that the nation should aim for. Instrument independence means that the central bank
8、 has control over the levers of monetary policy. That is, it has no obligation to finance government deficits, directly or indirectly, and that it has the power to set interest rates. Of course, a central bank that has goal and instrument independence can set its own monetary goals and is free to us
9、e the instruments at its disposal to achieve those goals. Even in nations with the most independent central banks, however, the government rather than the central bank usually has a final say on the type of exchange rate arrangement for the nation to have, and on changing the exchange rates in a fix
10、ed exchange rate system, or on foreign exchange market interventions to affect the level of exchange rates if the nation chooses to have a flexible exchange rate system (Capie, 1998). Theoretically, there are two different approaches to central bank independence. One is the conservative-banker appro
11、ach of Rogoff (1985) and the other is the principal-agent approach of Walsh (1995). In the conservative-banker approach, the central bank has both goal and instrument independence. Presumably, the conservative banker will weigh deviations of both inflation and output from target levels in setting mo
12、netary policy, but with a bias in favor of lower inflation, even if this comes at the expense of lower growth. In the principal-agent approach, on the other hand, the central banker has instrument independence, but not goal independence. That is, the government sets the monetary goal, such as the ra
13、te of inflation for the nation, and then the central bank is free to employ whatever monetary instruments it has at its disposal in trying to meet the monetary goal. The principal-agent goal is most explicit in the case of New Zealand, where the governor of the central bank formally agrees to meet t
14、he inflation target set by the government, with his job on the line if he fails to meet the target. In Canada and England, it is the reputation of the central bank that is on the line if the inflation target is exceeded. Today, there is general agreement that a central bank should have instrument, b
15、ut not goal independence. There are two reasons for this. The first is that the monetary goal of the nation should reflect the social welfare function of the nation and not just the preferences of the central bank governor. The second is that there is the need to coordinate monetary and fiscal polic
16、ies to avoid their operating at cross purposes of each other. Central bank accountability, however, is needed to ensure that the monetary goals of the nation are, in fact, pursued by the nations central bank. In the case of New Zealand the governor of the central bank is accountable to the finance m
17、inister. In the United States, the Federal Reserve Bank or the Fed (the US central bank) is generally accountable to Congress, which must ratify the choice of the chairman of the Fed and can summon him to explain his policies. In Germany, the Bundesbank is accountable to the public at large for its
18、policies in defense of the currency.In recent years, a growing number of countries are following the lead of New Zealand in setting explicit inflation targets for the central bank. This provides transparency and accountability, which are very important in establishing credibility for the governments
19、 monetary policy. The more credible a central bank is, the more it will be able to cut interest rates in a slowdown without triggering higher inflationary expectations and hence higher long-term interest rates, or raising interest rates to curb emerging inflationary pressures without the fear of tri
20、ggering a recession. It is to increase transparency and accountability, and hence its credibility and effectiveness, that the central bank of several countries, including the United States, have recently started to explain their decision-making process (including the lagged publication of the minute
21、s of their meetings by the US Fed) and operating procedure in their conduct of monetary policy. The fact, however, that the US Fed, as opposed to most other central banks, is constitutionally required to pursue both price stability and full employment, reduces its effectiveness as an inflation fight
22、er when a conflict arises between its two goals (Salvatore, 1998d). 3.2. Central bank independence and inflation As expected, a number of empirical studies have shown an inverse relationship between central bank independence and the rate of inflation in industrial countries. That is, the more independent the central bank of an industrial country is, the lower the rate of inflation in the nation. One of the most comprehensive of these studies is the one by Alesina and Summers (1993). The authors included the following 16
