Populists can pressure central banks to cut rates, paper finds

Researchers say the most populist governments can get rates lowered by 30 basis points

Recep Tayyip Erdogan
Recep Tayyip Erdoğan
Photo: Flickr/US Department of Commerce

Populist leaders can successfully pressure central banks to lower interest rates through public attacks, a research paper argues.

Michael Gavin and Mark Manger find such leaders can achieve concessions on monetary policy without formally reducing central banks’ legal independence of central banks.

Populism and De Facto Central Bank Independence uses a political bargaining model to explain its findings. The paper was published in Comparative European Politics.

The authors define populism as

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@centralbanking.com or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact info@centralbanking.com to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Central Banking? View our subscription options

Register for Central Banking

All fields are mandatory unless otherwise highlighted

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account