Translating central bank independence into Norwegian: central bankers and the diffusion of central bank independence to Norway in the 1990s

Abstract

ABSTRACTThe sweeping diffusion of central bank independence (CBI) as an institutional norm in many countries over the course of the 1990s has attracted a lot of interest within the discipline of international political economy. Important strands within the literature have emphasised the role of ideas and of central bank institutions in the diffusion process, although not placing ultimate explanatory weight on central bankers’ actions and activities in order to explain differences in patterns of diffusion between countries. Norway represents an outlier in the diffusion process, not reforming its central bank legislation until 2003 – six years later than the United Kingdom. The article explores this late shift to CBI by building on an ideational approach, investigating whether Norwegian central bankers’ translation strategies and actions adds more explanatory value than the mainly structural arguments dominating the existing diffusion literature. The article finds that central bank action and changing strategies actually helps us a great deal explaining why Norwegian authorities chose to alter central bank legislation when they did.