یکی از سیاست های پولی و 18 روسای بانکهای مرکزی: اجرای سیاست پولی اروپا به عنوان یک بازی هیات استراتژیک

This paper employs a multi-country delegation monetary policy model and argues that a decision-making mechanism based on the median voter theorem where intensity of preferences cannot play a role does not capture important aspects of policy setting in the European Monetary Union. Replacing the median voter mechanism with a less restrictive “weighted mean mechanism”, it is shown that strategic delegation can lead to a surprising degree of central bank inflation aversion. This finding supports the “The Twin Sister Hypothesis” and the perception of the European Central Bank implementing the policy of the Bundesbank rather than a more inflationary monetary policy.

Within a multi-country, one-period strategic delegation framework, this paper shows that strategic delegation can lead to a surprising degree of central bank inflation aversion. The paper provides further theoretical support for why the European Central Bank (ECB) might be the twin sister of the Bundesbank, i.e. why the monetary policy of the ECB mimics that of the Bundesbank rather than constituting an average of the optimal monetary policies of all the member states. Several papers have made contributions towards creating a better understanding of the single monetary policy and its implications. Debrun (2001) uses a two-country two-good model and a bargaining game to show that the ECB is minimizing a loss function biased towards German preferences, thereby proponing “The Twin Sister Hypothesis”. Aksoy et al. (2002) analyze the optimal policy-setting rule under four decision scenarios (each characterizing whether the ECB Executive Board and/or the national central bank presidents have national or EMU-wide interests or whether policy is set in accordance with a European Monetary System-rule) and find that different member states have different views as to what is the optimal policy rule. In an early contribution, von Hagen and Süppel (1994) use a multi-country model with incomplete information to show that national interests can lead to inefficient choices. Meade and Sheets (2002) also point to the importance of viewing the ECB Council as a group of delegates with conflicting interests. They find that the majority of ECB Council members typically voted on monetary policy changes in a manner that can be justified by the differential between their national inflation rate and the EMU average, thus suggesting that national interests or biases—of all 18 council members and not just the national central bank presidents—may play a role in deciding on the single monetary policy.1 The delegation framework seems particularly well-suited for capturing the implications of a French delegate being French and a German delegate being German rather than both being merely Europeans. Within such a framework, this paper points to the importance of how the decision-making mechanism of the Council is modeled and argues that a mechanism based on the median voter theorem is overly restrictive, since focusing on the median neglects the importance of the intensity of preferences. The political economy literature incorporates several alternative decision-making mechanisms.2 One oft-used alternative mechanism is the probabilistic voting model.3 A straightforward application of the probabilistic voting model to a fixed set of Council members deciding on the single monetary policy—in the absence of strategic delegation—would set policy according to the average preferences of the ECB Council. However, by replacing the median voter mechanism with a “weighted mean mechanism”, consistent with the probabilistic voting view, it is shown that allowing for strategic delegation may lead to a monetary policy set in accordance with the preferences of the most inflation-averse member state.4 The intuition behind this result is that the median voter in each member state understands that the decision-making mechanism at the council is such that intensity of preferences matter and, therefore, attempts to manipulate the outcome away from what would prevail in the absence of strategic delegation and towards what is individually preferred. While the most inflation-averse member state is always able to push for higher interest rates in order to off-set the less inflation-averse states’ push for lower interest rates, the less inflation-averse states can at most push for zero interest rates. This leads to a Nash game equilibrium where monetary policy for the entire union is set by the most inflation-averse member state. This result supports “The Twin Sister Hypothesis” and may help explain why Germany was willing to join the EMU despite having already achieved credible commitment of monetary policy to an inflation-averse monetary authority. The result is robust to non-simultaneous appointment choices and, therefore, the findings of the paper also indicate that unless the decision-making process of the ECB Council is altered, enlargement of the EMU would not alter the monetary policy of the ECB. The rest of the paper is organized as follows: Section 2 presents the multi-country delegation model. Section 3 discusses the median voter theorem and the “weighted mean mechanism” and describes the strategic delegation game and its unique equilibrium. Section 4 discusses robustness and Section 5 concludes.

The paper employs a multi-country delegation model of a single monetary policy with interest rates as the actual monetary policy instrument. Rather than assuming a single policy-maker or aggregating the preferences of the council members into a union-wide loss function, each council member votes on the single monetary policy in accordance with his “nationalistic” preferences. Since the median voter theorem is indifferent to intensity of preferences such that any role for strategic delegation when the member states decide on who to send to the council is, in effect, ruled out a priori, an alternative and less restrictive “weighted mean mechanism” is employed. Allowing for preference intensity and strategic delegation to matter, it is shown that the equilibrium of the Nash game is well-defined, unique and does not “explode”. More importantly, the equilibrium is associated with a single monetary policy identical to what the most inflation-averse member state would implement in the absence of a monetary union. This finding is seen as offering further theoretical support for “The Twin Sister Hypothesis” and the notion of the ECB implementing the policy of the Bundesbank rather than the policy of an average union-wide central bank. Furthermore, it may help explain why Germany, with a strong currency and a credibly independent monetary authority already in place, was willing to enter the EMU in the first place and it contrasts the notion of Germany forsaking a tight monetary policy in order to participate in the monetary union.