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Monetary Policy Deliberations: Committee Size and Voting Rules*

Published online by Cambridge University Press:  17 August 2016

Vincent Maurin  and
Jean-Pierre Vidal
Vincent Maurin
Affiliation:
European University Institute. Email: [email protected]
Jean-Pierre Vidal
Affiliation:
European Central Bank and Centre d’Economie de la Sorbonne (UMR 8174). Email: [email protected]
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Summary

How large should a monetary policy committee be? Which voting rule should a monetary policy committee adopt? This paper builds on Condorcet's jury theorem to analyse the relationships between committee size and voting rules in a model where policy discussions are subject to a time constraint. It suggests that in large committees majority voting is likely to enhance policy outcomes. Under unanimity (consensus) it is preferable to limit the size of the committee. Finally, supermajority voting rules are social contrivances that contribute to policy performance in a more uncertain environment, when initial policy proposals are less likely to be correct, or when payoffs are asymmetric.

Quelle est la taille optimale d'un comité de politique monétaire? Quelle est la meilleure règle de vote? Dans l'esprit du théorème de Condorcet, cet article propose un modèle de prise de décision contenant des phases de délibération pendant lesquels les membres du comité peuvent changer de position. Ce processus de délibération est conclu par une décision qui peut être prise à l'unanimité, à la majorité simple ou à la majorité qualifiée. En termes de performance, la majorité simple apparaît plus efficace pour les comités composés d'un grand nombre de membres. En revanche, décider à l'unanimité n'est profitable que dans les comités de petite taille. D'une manière générale, les règles de super-majorité sont adaptées dans un environnement incertain, lorsque les propositions initiales ont moins de chance d'être correctes, ou dans des problèmes de décision asymétrique, quand la perte liée à l'adoption d'une mauvaise proposition est plus élevée que celle du rejet d'une bonne proposition.

Keywords

Monetary policycollective decision-makingoptimal committee sizevoting rulesD71D78D81E58Politique monétairemécanisme de décision collectivetaille optimale d’un comitérègles de voteD71D78D81E58
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 80 , Issue 2 , 2014 , pp. 47 - 83
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2015 

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Footnotes

*

We would like to thank Alessandra Casella and Eric Leeper for stimulating discussions at an early stage of this project, Beata Bierut, Ludger Schuknecht and an anonymous referee for helpful comments. Suggestions by Philippine Cour-Thimann and Alexander Jung, as well as by participants at the 25 November 2011 meeting of the ECB Research Coordination Committee Forum on Central Bank Decision-making and Central Bank Communication and at the 15 March 2012 seminar of IRES (Louvain-la-Neuve) are gratefully acknowledged. This paper was started when Vincent Maurin was a trainee in the Monetary Policy Strategy Division. The views expressed are those of the authors and do not necessarily reflect those of the ECB.

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