Central Bank Independence: Does the Governor's Passport Matter?

Publication: Policy Letter No. 10, 2012
Topic Area: Macro Finance
Authors: Laura Moretti
Date: May 2012
Keywords: central bank independence, central bank governor

The idea of appointing a non-national as Central Bank Governor remains surprisingly controversial. Nevertheless, given the skills required by the Governor in order to manage what no doubt are increasingly complex institutions, considering non-nationals makes good sense for at least two reasons. First, increasing the pool of candidates to include those with broader skills and backgrounds makes it easier to find a suitable person for the job. Second, non-nationals are less likely to be beholden to domestic pressure groups and could help better insulate the central bank from political pressures.

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