Uncertainty and the Bank of England's MPC

Chappell, H.W.; Greene, William; Harris, Mark; Spencer, C.

doi:10.1111/jmcb.12854

Access Status

Fulltext not available

Authors

Chappell, H.W.

Greene, William

Harris, Mark

Spencer, C.

Date

2021

Type

Journal Article

Metadata

Show full item record

Citation

Chappell, H.W. and Greene, W. and Harris, M.N. and Spencer, C. 2021. Uncertainty and the Bank of England's MPC. Journal of Money, Credit and Banking.

Source Title

Journal of Money, Credit and Banking

DOI

10.1111/jmcb.12854

ISSN

0022-2879

Faculty

Faculty of Business and Law

School

School of Accounting, Economics and Finance

URI

http://hdl.handle.net/20.500.11937/86467

Collection

Curtin Research Publications

Abstract

We investigate how recently developed measures of uncertainty affect the voting behavior of individual Bank of England Monetary Policy Committee (MPC) members. To determine the precise impact of uncertainty on individual policymakers, we estimate the standard errors of member-specific parameters in a random parameters ordered probit framework. We find that uncertainty is typically associated with voting to ease the policy stance. The Bank of England's in-house uncertainty index plays a prominent role in driving voting behavior. Based on this measure, the MPC emerges as a diverse group of activist risk managers.