Analytical Corner: Central Bank Independence and Inflation in Latin America—Through the Lens of History


Location: Meeting Halls A&B, HQ1-3-430A&B



We study the link between central bank independence and inflation by studying Latin America’s historical experience. Using a dataset spanning 100 years, we recount the rocky journey traveled by central banks to achieve independence and price stability. Our empirical analysis shows that improvements in independence result in a steady decline in inflation and in reductions in the likelihood of high inflation episodes.



Samuel Pienknagura
Research Department