Carlo Altavilla, Wolfgang Lemke, Roberto Motto, Natacha Valla, 28 February 2019

The ECB Conference on Monetary Policy took place in Frankfurt from 29 to 30 October 2018. This column describes presentations on topics including the interaction of monetary policy and financial markets, the relevance of banks and credit flows for monetary policy transmission, and the current challenges for monetary policy frameworks and strategies. The conference provided a forum for academic research and the practice of central banking to meet. 

Olivier Coibion, Yuriy Gorodnichenko, Michael Weber, 22 February 2019

Monetary policy increasingly relies on communication, but most households are unaware of inflation targets or monetary policy announcements. This column uses large-scale randomised controlled trial of US households to study how different forms of communication influence the inflation expectations of individuals. Reading the Federal Open Market Committee statement has about the same average effect on expectations as being told about the Federal Reserve’s inflation target. Reading a news article about the same statement cuts the effect by half. 

Refet Gürkaynak, Burçin Kısacıkoğlu, Jonathan Wright, 12 December 2018

News affects the yield curve, but OLS regressions based on observed news have been able to explain only 40% of the movement, at best. This column proposes a method for estimating unobserved news as well. The results suggest that news explains more or less all of the yield curve changes in event windows, and that more should be done to understand the economics behind this relationship. 

Anna Cieslak, Andreas Schrimpf, 22 October 2018

Central bank communication affects asset prices and therefore the broader economy, but the channels through which this happens are not clear. The column proposes a novel approach to distinguishing the types of news. In more than half of communication events, the non-monetary component dominates the market reaction to central bank communication.

Pauline Charnoz, Claire Lelarge, Corentin Trevien, 22 April 2018

Research has shown that lower communication costs can act as a centralising force, prompting workers tend to rely more on the help of others and to specialise on a narrower set of tasks. This column reveals how reduced travel times resulting from a new high-speed rail transport in France fostered functional specialisation across different units of firms and greater centralisation. The findings highlight the mechanisms determining the level and distribution of productivity in an economy, and their redistributive impact both between and within firms

Charles Bean, 15 March 2018

Interest rates are near zero and inflation is even lower. Professor Sir Charles Bean, former Deputy Governor at the Bank of England and President of the Royal Economic Society, talks to Mark Thoma about the importance of clear communication in such uncertain times. The interview was recorded at the Royal Economic Society annual conference at The University of Manchester in Spring 2015 and produced by Econ Films.

Paul Krugman, 15 January 2018

How important are titles when it comes to communicating economics? In this video, Paul Krugman underlines the importance of arguing in a way that the largest audience possible can understand. This video was recorded at the "Ten year after the crisis" conference in September 2017 for Communicating Economics.

Christopher Pissarides, 06 December 2017

Communicating economic ideas is becoming more complicated. Christopher Pissarides advises to communicate research through books and articles using simple language. This video was recorded at the 6th Lindau Meeting on Economic Sciences in September 2017.

Diane Coyle, Jagjit Chadha, Paul Johnson, Simon Wren-Lewis, Angus Armstrong, 04 September 2017

Good examples are key for communicating economic results. In this video, various economists underline the importance of having relevant examples, as well as using the appropriate language for communicating with the public. This video was recorded for Communicating Economics.

Soumaya Keynes, 03 July 2017

What can economists learn from journalists' experiences? In this video, Soumaya Keynes talks about three key aspects economists should keep in mind when communicating their research to the public. This video was recorded in April 2017 for Communicating Economics.

Deirdre McCloskey, 05 May 2017

Communication and persuasion are important elements of economists’ jobs. In this video, Deirdre McCloskey discusses effective ways to communicate economic concepts and facts.

Stephen Hansen, Michael McMahon, 03 February 2016

In addition to setting interest rates, central banks also communicate with the public about economic conditions and future actions. While it has been established that communication can drive expectations, less is known about how it does so. This column attempts to shed light on this question. Applying novel measures to the content of Federal Reserve statements, it shows that forward guidance is a more important driver of market variables than disclosure of information about economic conditions.

Barry Eichengreen, Arnaud Mehl, Romain Lafarguette, 22 January 2016

There is ongoing debate about the impact of technological progress on the geography of trade and production. One view is that cheap technology has attenuated the effect of distance, while others argue that location still matters. This column explores the issue in the context of foreign exchange markets. It examines how submarine fibre optic cables that link locations to financial hubs have affected the location of transactions. The findings suggest, on balance, that technological progress has made proximity to a trading centre more important.

Carin van der Cruijsen, David-Jan Jansen, Jakob de Haan, 23 August 2015

Central banks have typically targeted their communication at financial markets. Increasingly, however, many have started actively communicating with the general public. Using Dutch survey data, this column finds that the public’s knowledge of monetary policy objectives is far from perfect, and varies widely across respondents. Those with a greater understanding of ECB objectives tend to form more realistic inflation expectations. Central banks seeking to target the general public must take account of discrepancies in households’ knowledge of and interest in monetary policy.

Aleš Bulíř, Martin Cihák, David-Jan Jansen, 10 April 2013

Quality, clear communication is a very powerful tool for central banks because it influences expectations. This column presents new research on central-bank communications, using a formal measure of clarity – the ‘Flesch-Kincaid grade level’. The picture is varied: there are significant and persistent differences in clarity over time and across countries. However – and worryingly – the financial crisis is associated with unclear communication for some central banks.

Michael Ehrmann, Marcel Fratzscher, Benjamin Born, 29 November 2010

In response to the financial crisis, many central banks are receiving significant new responsibilities for macroprudential supervision. Exploiting the experience of central banks with Financial Stability Reports and other financial stability-related statements, this column argues that such central bank communication can be highly effective, in particular during periods of financial stress.

Events

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