CENTRAL BANK INDEPENDENCE MEASURING

Nowadays independence of central banks creates a background not only for the price stability but also for the banking system stability. The negative experience of political and economic crises attests to the priority of ensuring central bank independence as the main prerequisite for its effective ac...

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Bibliographic Details
Main Authors: Babayev, Azer, Vasilyeva, Tetyana, Dudchenko, Victoria
Format: Conference Proceeding
Language:English
Subjects:
Bank management
Banking
Banking industry
Central banks
Chief executive officers
Economic crisis
Efficiency
Indicators
Inflation
Monetary policy
Objectives
Regulation of financial institutions
Systems stability
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Summary:Nowadays independence of central banks creates a background not only for the price stability but also for the banking system stability. The negative experience of political and economic crises attests to the priority of ensuring central bank independence as the main prerequisite for its effective activity in regulating the banking system. Existing researches define different types of central banks efficiency. It is determined that the most general of them is the operational, functional, financial, political, personal, legal, institutional independence of the central bank. Each type of independence determines the specific indicators that should be used to measure it. The most important task in building an integrated central bank independence indicator is to choose the right approach to combine a number of these specific indicators. To solve this problem it is necessary to correctly choose the number of indicators describing each direction of independence and their weights in the general structure. Despite the existence of a number of integrated indices of central banks independence, their structure often depends on the subjective approach of authors and does not take into account all existing aspects. The aim of the paper is to develop the complex approach for central bank independence measuring that include its different dimensions evaluated both quantitative and qualitative indicators. This was done by summarizing the different types of central bank independence andjustifying the criteria to be used to characterize them. The conducted study forms a basis for measuring the role of central bank independence in ensuring its performance and achieving its strategic and tactical goals.
ISSN:1849-6903
1849-6903