Archive for November 17th, 2010

Economics of central banks’ decision making

November 17, 2010

Norway Central Bank Deputy Governor Jan F. Qvigstad gives a superb speech on the topic. The speech revolves around how central banks make decisions and what makes a decision good or bad. He also talks about what goes into trying to make better decisions. It covers following areas:

  • Independence provides a sound framework for interest rate decisions
  • We make decisions under uncertainty
  • Groups often make better decisions than individuals
  • But groups are no guarantee for good decisions
  • How do we arrive at a decision?
  • Was the decision good?

The overall speech is superb drawing insights from other subjects like history, politics, psychology, television shows etc.

(more…)

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