Here is the synopsis of our sample research paper on Central Bank Independence. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
This 6 page paper considers why central bank independence is generally considers as advantageous for the creation of price stability by reducing inflationary pressures. The paper looks at the way that an independent bank may operate form a politically control central bank and then assess the real value of independence. The bibliography cites 4 sources.
Page Count:
6 pages (~225 words per page)
File: TS14_TEcenbank.rtf
Buy This Term Paper »
Unformatted sample text from the term paper:
increase international creditability in the economy, the lack of manipulation potential to by the government and the value of specialist independent knowledge running the economy all results in the same
conclusion. The value of an independent bank is associates strongly with increased price stability. However of all the commentators there appears to be a great reluctance to acknowledge the disadvantages
to an independent central bank and the potential downside. The supporters of independence that state there is a clear relationship between increased price stability and an independent central bank
are wide ranging including Rogoff, (1985) and Cukierman (1992). However, it has also been realised that one reason for the creation of a central bank that is independent is
also one of fear or concern, to limit the powers of future political successors (Cukierman, 1992). The creation of an independent central bank can be seen as a string
policy message, it is a long term commitment to the economy and the way in needs to be handled, it is also a tool that facilitates anti-inflationary measures, which are
argued to soften the blows an economy may suffer for the natural business cycles (Rogoff, 1985). This may also operate by the way the internalisation of costs for riskily lending
is forced onto the financial intermediaries. This creates greater efficiency within the economy, as when lending is constrained in this way the inefficient operation will be forced out of the
market, and as such the budget deficits will decrease as well as reducing the pressure for monetary expansion (Cukierman, 1992). Therefore we can argue that the independence of a central
bank helps create price stability and is enhanced with the development of the financial markets. However, this does not tell us why independence is seen as a good thing rather
...