Picking the Brains of MPC Members

Abstract

This paper reports and analyzes the results from a questionnaire sent to all present and former members of the Riksbank's Executive Board, the monetary policy committee (MPC) of the Swedish central bank. The questions cover a number of issues discussed in the growing literature on monetary policy making by committees. The paper thus relates research to the views of practitioners in a way that has not been done before. We find, among other things, that many members consider the six-person strong Riksbank MPC to be slightly too large, that it is very common that members have decided before the policy meeting how they will vote, and that members, when forming their opinions, consider input from the staff more important than input from their colleagues.

Monetary Policy Decisions - Comparing Theory and 'Inside' Information from MPC Members

“…5 out of 12 responses of the Norges Bank members responded that they have "never" refrained from entering a reservation, 6 stated that they have "seldom" refrained from entering a reservation, and 1 responded that he/she "sometimes" has refrained from entering a reservation. Although there is a stronger tendency at Norges Bank to refrain from entering a reservation than at the Riksbank, 15 Apel et al (2010) distinguish between members who were present before vs after publishing the Riksbank's own interest rate forecasts, suggesting that the introduction of interest rate forecasts has reduced the Chairman's role.…”

Communicating Dissent on Monetary Policy: Evidence from Central Bank Minutes

“…He suggests that providing information on the views of individual members, for example through the publication of minutes, can provide"useful information about the diversity of views and the balance of opinion on a committee". In a survey of the Riksbank's present and former MPC members, Apel et al (2010) ask about the effects of the publication of attributed minutes on the nature of the discussion. The statement that attributed minutes make the discussion more inhibited and less spontaneous received the least support ("applies only to a slight extent"), while the statement that attributed minutes make the discussion better received the most support ("applies to some extent").…”

The Information Content of Central Bank Minutes

“…In a questionnaire study, Apel, Claussen and Lennartsdotter (2010) collect the views of present and former members of the Riksbank's MPC on this and other issues. As noted above, in Sweden, minutes have been attributed since May 2007.…”

“…It seems quite reasonable that members sometimes raise concerns about issues they consider important but not sufficiently important to warrant a dissenting vote. Results from the questionnaire study by Apel, Claussen and Lennartsdotter (2010) suggest that MPC members sometimes refrain from dissenting, despite considering that another decision than the majority view would have been better -there is a "bargaining margin" in the policy rate decisions and the decision reached is regarded as being sufficiently close to what the members would have advocated.…”