This article advances the scholarly debate on public agencies’ communication by developing a reputation-based account to explain the relative salience that different issues assume in central banks’ communication. Based on an innovative dataset consisting of a corpus of speeches by members of the Board of Governors delivered from 2006 to 2016, the analysis shows that the most salient issues in the Fed’s communication are shaped by reputational concerns about policy reversals. Specifically, when these concerns are higher, the Fed is more likely to focus on issues related to areas where its reputation is weak or not yet established – i.e., issues related to credit easing and systemic financial regulation. In contrast, issues related to activities where the Fed’s reputation is established are likely to become less salient – i.e., issues related to economic activity and inflation. A similar pattern of issue attention is observed when the Fed addresses political audiences compared to other audiences.

Central banks’ communication as reputation management: How the Fed talks under uncertainty

Manuela Moschella
;
Luca Pinto
2019

Abstract

This article advances the scholarly debate on public agencies’ communication by developing a reputation-based account to explain the relative salience that different issues assume in central banks’ communication. Based on an innovative dataset consisting of a corpus of speeches by members of the Board of Governors delivered from 2006 to 2016, the analysis shows that the most salient issues in the Fed’s communication are shaped by reputational concerns about policy reversals. Specifically, when these concerns are higher, the Fed is more likely to focus on issues related to areas where its reputation is weak or not yet established – i.e., issues related to credit easing and systemic financial regulation. In contrast, issues related to activities where the Fed’s reputation is established are likely to become less salient – i.e., issues related to economic activity and inflation. A similar pattern of issue attention is observed when the Fed addresses political audiences compared to other audiences.
Settore SPS/04 - Scienza Politica
central banks; communication; reputation; Federal Reserve; monetary policy; topic modeling
Fondi MUR
RBSI14KCWY
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Descrizione: Nome del programma: SIR bando 2014 - Acronimo del progetto: UNCENTRAL - Numero di contratto: RBSI14KCWY - Data di pubblicazione: settembre 2019 - Scheda di progetto con tutti i soggetti che hanno concorso alla realizzazione del paper: Manuela Moschella, Luca Pinto
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Licenza: Creative commons
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11384/76427
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