Premium
The Discursive Dilemma in Monetary Policy
Author(s) -
Claussen Carl Andreas,
Røisland Øistein
Publication year - 2014
Publication title -
the scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/sjoe.12062
Subject(s) - premise , dilemma , voting , economics , majority rule , law and economics , monotonic function , positive economics , microeconomics , political science , epistemology , law , philosophy , mathematics , mathematical analysis , politics
Abstract The discursive dilemma implies that the decision of a board depends on whether the board votes directly on the decision (conclusion‐based procedure) or votes on the premises for the decision (premise‐based procedure). We derive results showing when the discursive dilemma might occur. Under majority voting, a discursive dilemma can occur either (i) if the relationship between the premise and the decision is non‐monotonic, or (ii) if the board members have different judgments on at least two of the premises. Normatively, a premise‐based procedure tends to give better decisions when there is disagreement on parameters of the model.