What Do Outside Experts Bring To A Committee? Evidence From The Bank of England

We test whether outside experts have information not available to insiders by using the voting record of the Bank of England’s Monetary Policy Committee. Members with more private information should vote more often against conventional wisdom, which we measure as the average belief of market economists about future interest rates. We find evidence that external members indeed have information not available to internals, but also use a quasi-natural experiment to show they may exaggerate their expertise to obtain reappointment. This implies that an optimal committee, even outside monetary policy, should potentially include outsiders, but needs to manage career concerns.


Issue Date:
Oct 05 2010
Publication Type:
Working or Discussion Paper
Record Identifier:
http://ageconsearch.umn.edu/record/270783
Language:
English
Total Pages:
43
JEL Codes:
D70; E52
Series Statement:
WERP 946




 Record created 2018-04-05, last modified 2018-04-05

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