Carl Walsh, distinguished professor of economics at UC Santa Cruz, has been appointed as a scientific adviser to Norges Bank, the central bank of Norway, for three years through December 2016.
Walsh said Norges Bank has been at the forefront in developing what is generally described as a "flexible inflation targeting monetary policy regime," meaning a regime in which inflation stability is a key objective of monetary policy, but the central bank also is "flexible" by taking broader macroeconomic developments into account, such as unemployment, to achieve its inflation objective.
The bank is launching a three-year research project designed to analyze potential changes to its policy regime. Walsh will provide advice on the project as one of three international scientific advisers. He expects to visit Norges Bank at least once a year as well as respond to requests for comments on specific policy or research questions as needed.
Some of the practices the bank has adopted are being adopted by other central banks, Walsh said, including the U.S. Federal Reserve. Walsh and the two other international scientific advisers will be expected to present their views on the research project, suggest research topics, and give advice to top management at the bank and the bank's executive board.
Walsh is the author of the textbook Monetary Theory and Policy, (3rd edition, MIT Press, 2010) and has served as a visiting scholar at the Federal Reserve Bank of San Francisco.
