An Empirical Analysis of the Degree of Independence and Transparency of Central Bank of Rwanda
Journal of Public Policy and Administration
Volume 1, Issue 2, December 2017, Pages: 65-69
Received: Oct. 7, 2017; Accepted: Nov. 2, 2017; Published: Dec. 22, 2017
Views 1843      Downloads 146
Harerimana Jean de Dieu, School of Economics, University of Nairobi, Nairobi, Kenya
Uwacu Florent, School of Economics, University of Nairobi, Nairobi, Kenya; Statistical Analysis and Research Support, Kigali, Rwanda
Article Tools
Follow on us
The aim of this paper is, thus, to evaluate the degree of independence and transparency of the Central Bank of Rwanda. The econometric time series using ARDL model estimated the counterfactual effect of the side effect of the policy from the period of 1980 to 2015. Macroeconomic variables were used to predict each outcome from past inflation, openness, GDP per capita, and various measures of the strength of institutions as explanatory variables. The results showed that inflation and interest rate remained inconclusive to have a long run relationship while the participatory labor rate has a long run relationship with trade openness. In conclusion, the empirical analysis fails to explain the fluctuation in the interest rate or keeping the inflation under control may not mean the low level of independence or transparency from Central Bank of Rwanda.
Independence, Transparency, Central Bank, ARDL
To cite this article
Harerimana Jean de Dieu, Uwacu Florent, An Empirical Analysis of the Degree of Independence and Transparency of Central Bank of Rwanda, Journal of Public Policy and Administration. Vol. 1, No. 2, 2017, pp. 65-69. doi: 10.11648/j.jppa.20170102.13
Copyright © 2017 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License ( which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Primature. Official Gazette of the Republic of Rwanda. Off Prime Minist Law n° 55/2007 30/11/2007. 2007.
Walsh CE. Central Bank Independence Revisited. Econ Pap A J Appl Econ policy. 2011; 30 (1): 18–22.
Walsh C. Central bank independence, prepared for the New Palgrave Dictionary. In: New Palgrave. 2005. p. 1–10.
Mangano G. Measuring central bank independence: a tale of subjectivity and of its consequences. Oxf Econ Pap. 1998; 50 (3): 468–92.
Kydland FE, Prescott EC. Rules Rather than Discretion: The Inconsistency of Optimal Plans. J Polit Econ. 1977; 85 (3): 473–91.
De Haan J, Kooi W. What really matters: conservativeness or independence? PSL Q Rev. 2013; 50 (200).
Nordhaus WD. The Political Business Cycle. Rev Econ Stud. 1975; 42 (2): 169–90.
Henning CR. Currencies and Politics in the United States, Germany, and Japan. Peterson Institute for International Economics; 1994.
Waller CJ, Walsh CE. Central-Bank Independence, Economic Behavior, and Optimal Term Lengths. Am Econ Rev. 1996; 86 (5): 1139–53.
Debelle G, Fischer S. How independent should a central bank be? Conf Ser. 1994; 38 (1977): 195–225.
Bank W. World Development Indicators 2017. The World Bank; 2017.
Oatley TH. Central Bank Independence and Inflation: Corporatism, Partisanship, and Alternative Indices of Central Bank Independence. Public Choice. 1999; 98 (3): 399–413.
Pesaran MH, Shin Y, Smith RJ. Bounds testing approaches to the analysis of level relationships. J Appl Econom. 2001; 16 (3): 289–326.
Pesaran, M. H., Shin Y. An autoregressive distributed lag modelling approach to cointegration analysis. In: Econometrics and Economic Theory in the 20th Century: The Ragnar Frisch Centennial Symposium. 1999. p. 1–31.
Science Publishing Group
1 Rockefeller Plaza,
10th and 11th Floors,
New York, NY 10020
Tel: (001)347-983-5186