Persistently sticking to explicit “rules”, even ones that are inherently arbitrary, can play an important role in changing behaviour and perceptions. Visible adherence to rules by governments and central banks can also help restore credibility, regain influence and increase the probability of their preferred outcomes. Yet, there are also situations in which the configuration of some rules can get in the way of good decision-making. READ MORE[ Banks’ profit surge on higher rates may mask challenges, Central Bank warnsOpens in new window ]Such rules have been effective. The US and Europe also find themselves stuck with rules that, while well-meaning, need some reform.

Source: The Irish Times August 07, 2024 11:42 UTC