Determinants and effects of central bank independence reforms

This thesis consists of four empirically oriented papers on central bank independence (CBI) reforms.    Paper [1] is an investigation of why politicians around the world have chosen to give up power to independent central banks, thereby reducing their ability to control the economy. A new data-set, including the possible occurrence of CBI-reforms in 132 countries during 1980-2005, was collected. Politicians in non-OECD countries were more likely to delegate power to independent central banks if their country had been characterized by high variability in inflation and if they faced a high probability of being replaced. No such effects were found for OECD countries.    Paper [2], using a difference-in-difference approach, studies whether CBI reform matters for inflation performance. The analysis is based on a dataset including the possible occurrence of CBI-reforms in 132 countries during the period of 1980-2005. CBI reform is found to have contributed to bringing down inflation in high-inflation countries, but it seems unrelated to inflation performance in low-inflation countries.    Paper [3] investigates whether CBI-reforms are important in reducing inflation and maintaining price stability, using a random-effects random-coefficients model to account for heterogeneity in the effects of CBI-reforms on inflation. CBI-reforms are found to have reduced inflation on average by 3.31 percent, but the effect is only present when countries with historically high inflation rates are included in the sample. Countries with more modest inflation rates have achieved low inflation without institutional reforms that grant central banks more independence, thus undermining the time-inconsistency theory case for CBI. There is furthermore no evidence that CBI-reforms have contributed to lower inflation variability    Paper [4] studies the relationship between CBI and a suggested trade-off between price variability and output variability using data on CBI-levels, and data the on implementation dates of CBI-reforms. The results question the existence of such a trade-off, but indicate that there may still be potential gains in stabilization policy from CBI-reforms.

Preferenser och intressen hos Svenskt Näringsliv och Landsorganisationen om arbetskraftsinvandring under 2000-talets inledning

Preferences and interests of SN and LO about labour migration in the early 2000s The article uses a political economy approach to analyze the preferences of the social partners SN and LO and to identify the coincided and disparate interests which the two organizations tried to defend in relation to labour migration in the debate prior to the Swedish labour migration policy reform in 2008. In contrast to presumptions by Varieties of Capitalism (VoC) scholars,the results of this article reveal that SN has preferred a market-liberal labour migration policy regime at odds with institutional traditions of the Swedish labour market model. However, LO has instead preferred a state-coordinated and regulated labour migration policy regime. In contrast to SN, LO’s preferences reflected basic trade union interests to limit the supply of labour and to minimize potential negative effects for the functioning of the Swedish labour market model. Moreover, the article suggests the importance of changed power relations between the social partners and a shift of Swedish government to explain SN’s influence in the debate prior to the labour migration policy change 2008 in a market-liberal direction.