Question: One of the claims for central bank independence is that it reduces the likelihood of inflationary policies. One well known study of this issue, by Harvard University Economists Alberto Alesina and Lawrence Summers, strongly supports this contention. (Summers is the current president of Harvard University.) Consider a graph depicting the results of their research from a paper published by the Federal Reserve Bank of St. Louis, "Central Bank Independence and Economic Performance" (by Patricia S. Pollard)  found at

http://www.research.stlouisfed.org/publications/review/93/07/bank_jul_aug1993.pdf .

(The graph is on page 23 of the document.) Based solely on the graph, does there appear to be an inverse relationship between inflation and independence? Which countries appear to have high inflation and low independence? Which appear to have low inflation and high independence?

Price: $2.99

Solution: The downloadable solution consists of 1 pages
Deliverable: Word Document