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July/August 2002, 
Vol. 84, No. 4
Posted 2002-07-01

Central Bank Structure, Policy Efficiency, and Macroeconomic Performance: Exploring Empirical Relationships

by Stephen G. Cecchetti and Stefan Krause

Looking at a broad array of industrialized, transition, and emerging market economies, the authors see institutional reforms that have increased both the independence and accountability of central banks and, in addition, made monetary policy more transparent through clear public statement of instruments, methods, and objectives. In addition, they note that many central banks have succeeded in establishing significant reputations for competence, acquiring considerable credibility in the process.