The paper “ Central Banking in Theory and Practice by Alan S Blinder” is a creative example of a book review on finance & accounting. It was quite by accident that I chanced upon an extraordinary book by American Economist and ex vice-chairman of the United States Federal Reserve Board Alan Stuart Blinders Central Banking in Theory and Practice. Based and adapted on the 1996 Lionel Robbins Lectures, who incidentally was a book is a series of three lectures given at Cambridge University. I found the book not only informative but also liked the way it gives scope for understanding the theory and practice of central banking at even a layman level.
Alan Blinder has tried to make Central Banking in Theory and Practice an easy read for readers of all educational backgrounds. So you don’ t have to be an economist or a central bank employee for reading the book! It is written in a pretty non-technical manner and addresses various monetary policy issues. Alan Blinders is a professor of economics at Princeton University and has co-authored with William Baumol to produce an economics textbook.
He is known to be articulate and is a prominent New Keynesian economist. A lot of adjectives have been used to describe Alan Blinders like being highly intelligent, unbiased, dispassionate, at the same time possessing a strong sense of duty and passion towards issues in the public interest. Professor Blinder conveys thoroughly and admits easily enough the many limitations of both economic theory and historical evidence to the contrary. He delivers well through his book and makes the understanding of a lot of issues in the financial world, a nice read. The book starts with a basic assumption that society basically needs the services of the central bank to keep the market economy on a stable trend.
This includes matters of getting full employment, keeping low inflation, and stabilizing economic growth rate. Professor Blinder explains what he considers and thinks is the way a central banker should operate.
Smith, Adam, The Wealth of Nations, USA: Packard Technologies, 1776
Guitián, Manuel, Rules and Discretion in International Economic Policy, Washington, USA: International Monetary Funds, 1992
Romer, Christina, and Romer, David, Reducing Inflation: Motivation and Strategy, USA: University of Chicago Press, 1997
Eijffinger, Sylvester, and Waller, Sandra The Political Economy of Central-Bank Independence, MA: MIT Press, 2005