Does central bank independence matter in Arab oil exporters ?
Author
Source
Economic Research Forum : Working Paper Series
Issue
Vol. 2018, Issue 1172-1274 (31 Dec. 2018)35 p.
Publisher
Economic Research Forum for the Arab Countries Iran and Turkey
Publication Date
2018-12-31
Country of Publication
Egypt
No. of Pages
35
Main Subjects
Topics
Abstract EN
The paper shows that central banks in Arab oil exporters are not independent.
Low independence reflects institutional arrangements that allow the executive branch to influence, interfere and in some cases, dominate over central bank operations.
The paper argues that in a context of weak institutions, CBI has not always mattered for macroeconomic policy outcomes in Arab oil exporters.
GCC central banks delivered a better macroeconomic policy performance than those of the populous group.
CBI mattered less for the GCC because the credible peg discouraged discretion and was a good substitute for it.
Soft peg arrangements in the populous economies in a context of weak institutions and discretionary policymaking in the absence of a de facto independent central bank led to disappointing monetary policy outcomes.
As oil exporters adapt to a new normal of low oil prices, the sustainability of fixed exchange regimes may not be guaranteed without sound macroeconomic institutions.
Stronger institutions and effective accountability mechanisms are needed to insulate central banks from political pressures.
In the short-term, a rules-based framework could help
American Psychological Association (APA)
Salim, Huda. 2018. Does central bank independence matter in Arab oil exporters ?. Economic Research Forum : Working Paper Series،Vol. 2018, no. 1172-1274.
https://search.emarefa.net/detail/BIM-841049
Modern Language Association (MLA)
Salim, Huda. Does central bank independence matter in Arab oil exporters ?. Economic Research Forum : Working Paper Series No. 1172-1274 (Dec. 2018).
https://search.emarefa.net/detail/BIM-841049
American Medical Association (AMA)
Salim, Huda. Does central bank independence matter in Arab oil exporters ?. Economic Research Forum : Working Paper Series. 2018. Vol. 2018, no. 1172-1274.
https://search.emarefa.net/detail/BIM-841049
Data Type
Journal Articles
Language
English
Notes
Includes appendices : p. 19-33
Record ID
BIM-841049