The main objective of this article is to evaluate the institutional quality of ten central banks. The countries included for this study are New Zealand, the United Kingdom, the United States of America, Germany, Chile, Indonesia, South Korea, Thailand, Hong Kong and India. The central banks of these countries exhibit many disparities and similarities in their monetary regimes which provide ample scope for their analysis and evaluation. The analysis of the institutional experiences of other central banks offers rich lessons to India in pursuing its central bank reforms. This study reveals that almost all the central banks, with the exception of Indonesia and India, exhibit high standards of institutional quality in terms of balancing independence, transparency and accountability. The Central Bank (CB) models of the United Kingdom and New Zealand stand first in the world in this regard, closely followed by the United States and Chile.
In the last 15 years, there has been substantial rethinking about how Central Banks (CBs)
should structure their institutions to achieve the objectives of monetary policy in a better
way. This rethinking has brought about revolutionary changes in how CBs operate and
perform. Furthermore, we are now in an era in which, CBs in many countries, have had
notable success in keeping the inflation low, while their economies experienced rapid
economic growth.
The main objective of this study is to provide a comparative assessment of the quality
of institutional arrangements for monetary policy in ten countries. The countries selected
for this study are New Zealand, the United Kingdom, the United States of America,
Germany, Chile, Indonesia, South Korea, Thailand, Hong Kong and India. These countries
fall in one of the four categories of monetary policy regimes, i.e, inflation targeting,
monetary targeting, exchange rate targeting and the discretionary regime or a regime, with
an implicit but not an explicit nominal anchor. They offer a wide variety of similarities
and dissimilarities in the institutional characteristics of their monetary frameworks, which
make strong case for their analysis and evaluation. |
