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Central bank independence : an updated set of indices and the implications for inflation

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Pearlman, Joseph and Sarantis, Nicholas (2009) Central bank independence : an updated set of indices and the implications for inflation. Centre for International Capital Markets discussion papers, 2009 (16). pp. 1-40. ISSN 1749-3412

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Abstract

The Grilli-Masciandaro-Tabellini and Cukierman indices of central bank independence, as well as the turnover of central bank governors, are updated for the late 1990s and early 2000s using the most recently published central banking laws for 90 industrial and developing countries. Included in our indices are most of the Eastern European and South-East Asian countries and a subset of African states. We examine how these CBI indices correlate among themselves and how they compare with previous estimates of CBI indices based on legislation available in the 1980s. We also provide an assessment of how well the new CBI indices correlate with inflation for the periods following any new legislation.

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