The information value of observing monetary policy deliberations

Abstract

This paper considers the information value to private economic agents of immediate full disclosure of the monetary policy authority's deliberations. The analysis assesses the information value of several specific elements of the authority's decision making process under three different cases: explicit optimization under certainty, explicit optimization under uncertainty, and informal decision making. The main result is that, the less formal and structured is the authority's decision making process, the more aspects of its policy deliberations constitute potentially useful information for private economic agents.