How does transparency, a key feature of central bank design, affect the deliberation of monetary policymakers? We exploit a natural experiment in the Federal Open Market Committee in 1993 together with computational linguistic models (particularly Latent Dirichlet Allocation) to measure the effect of increased transparency on debate. Commentators have hypothesized both a beneficial discipline effect and a detrimental conformity effect. A difference-in-differences approach inspired by the career concerns literature uncovers evidence for both effects. However, the net effect of increased transparency appears to be a more informative deliberation process.Keywords: Monetary policy, deliberation, FOMC, transparency, career concerns JEL Codes: E52, E58, D78 * We would like to thank Francesco Amodio, Andrew Bailey, Francesco Caselli, Gilat Levy, Rick Mishkin, Emi Nakamura, Tommaso Nannicini, Bryan Pardo, Cheryl Schonhardt-Bailey, Jón Steinsson, Dave Stockton, Thomas Wood, and Janet Yellen for insightful discussions. We are particularly grateful to Omiros Papaspiliopoulos for numerous helpful discussions on MCMC estimation and Refet S Gürkaynak for sharing the monetary policy surprise data. We have also benefited from comments and suggestions by seminar attendees at the San Francisco Federal Reserve, University of Warwick, University of Manchester, INSEAD, Bank of England, LSE, the New York Federal Reserve, Columbia University, the ESRI, Universitat Pompeu Fabra and the CEP conference. We thank Eric Hardy for excellent research assistance in gathering biographical data, and the Bank of England's Research Donations Committee for seed corn financial support. Any errors remain ours alone.

We explore how the multi-dimensional aspects of information released by the FOMC has effects on both market and real economic variables. Using tools from computational linguistics, we measure the information released by the FOMC on the state of economic conditions, as well as the guidance the FOMC provides about future monetary policy decisions. Employing these measures within a FAVAR framework, we find that shocks to forward guidance are more important than the FOMC communication of current economic conditions in terms of their effects on market and real variables. Nonetheless, neither communication has particularly strong effects on real economic variables. JEL Codes: E52, E58 * We have benefited from comments during the ISOM conference in Zurich, and seminars at the National University of Singapore and the IMF. We would like to especially thank Martin Bodenstein, James Cloyne, Carlo Favero, Paul Hubert, Oscar Jorda, Christian Julliard, Dimitris Korobilis, Francesca Monti, Helene Rey and Francisco Ruge-Murcia for insightful comments, suggestions and discussions. Paul Soto and Marcel Schlepper provided excellent research assistance. Part of this work was completed when both authors were Houblon-Norman Fellows at the Bank of England. Michael is currently based at the IMF-STI. The views expressed in this paper are those of the authors and do not necessarily represent those of anyone at the Bank of England, the IMF or IMF policy. We also benefited from a British Academy small grant. Any errors remain ours alone.

Abstract-Using German microdata and a quasi-natural experiment, we provide evidence on how households respond to an increase in uncertainty. We find that household saving increases significantly following the increase in political uncertainty observed in the run-up to the 1998 German general election. We also find evidence of a labor supply response by workers who can use the margin offered by part-time employment. Our results are suggestive of the economic effects of "wars of attrition": when political disagreement leads to delays in adopting a reform or the possibility that earlier reforms may be revoked, the increased uncertainty could slow the economy.

Despite the recent revolution in central bank communication, it is unclear the general public have benefitted from these enhanced central bank communications. We first analyze the growth of communication and some reasons that the public may have missed the revolution. We then discuss the desirability of greater communication with the public. The case for feasibility of such communication examines observational and experimental evidence following the recently adopted use of a layered communication at the Bank of England. We find that, while more research is needed, there are compelling reasons for central banks to continue trying to target communication at the public.

We explore how the multi-dimensional aspects of information released by the FOMC has effects on both market and real economic variables. Using tools from computational linguistics, we measure the information released by the FOMC on the state of economic conditions, as well as the guidance the FOMC provides about future monetary policy decisions. Employing these measures within a FAVAR framework, we find that shocks to forward guidance are more important than the FOMC communication of current economic conditions in terms of their effects on market and real variables. Nonetheless, neither communication has particularly strong effects on real economic variables. JEL Codes: E52, E58 * We have benefited from comments during the ISOM conference in Zurich, and seminars at the National University of Singapore and the IMF. We would like to especially thank Martin Bodenstein, James Cloyne, Carlo Favero, Paul Hubert, Oscar Jorda, Christian Julliard, Dimitris Korobilis, Francesca Monti, Helene Rey and Francisco Ruge-Murcia for insightful comments, suggestions and discussions. Paul Soto and Marcel Schlepper provided excellent research assistance. Part of this work was completed when both authors were Houblon-Norman Fellows at the Bank of England. Michael is currently based at the IMF-STI. The views expressed in this paper are those of the authors and do not necessarily represent those of anyone at the Bank of England, the IMF or IMF policy. We also benefited from a British Academy small grant. Any errors remain ours alone.

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We test whether quantitative easing (QE), in addition to boosting aggregate demand and inflation via portfolio rebalancing channels, operated through a bank lending channel (BLC) in the UK. Using Bank of England data together with an instrumental variables approach, we find no evidence of a traditional BLC associated with QE. We show, in a simple framework, that the traditional BLC is diminished if the bank receives 'flighty' deposits (deposits that are likely to quickly leave the bank). We show that QE gave rise to such flighty deposits which may explain why we find no evidence of a BLC.

This paper provides new evidence on the effects of fiscal policy by studying, using household-level data, how households respond to shifts in government spending. Our identification strategy allows us to control for time-specific aggregate effects, such as the stance of monetary policy or the U.S.-wide business cycle. However, it potentially prevents us from estimating the wealth effects associated with a shift in spending. We find significant heterogeneity in households' response to a spending shock; the effects appear vary over time depending, among other factors, on the state of business cycle and, at a lower frequency, on the composition of employment (such as the share of workers in part-time jobs). Shifts in spending could also have important distributional effects that are lost when estimating an aggregate multiplier. Heads of households working relatively few (weekly) hours, for instance, suffer from a spending shock of the type we analyzed: their consumption falls, their hours increase and their real wages fall.