01733cas a2200253 a 4500 AALejournalIMF004761 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451866551 1018-5941 BD-DhAAL BD-DhAAL Le Borgne, Eric. Dynamic Incentives and the Optimal Delegation of Political Power / Eric Le Borgne, Gauti Eggertsson. Washington, D.C. : International Monetary Fund, 2007. 1 online resource (35 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper proposes a theory to explain why a politician delegates policy tasks to a technocrat in an independent institution. It formalizes the rationales for delegation highlighted by Hamilton (1788) and by Blinder (1998). Delegation trades-off the cost of having a possibly incompetent technocrat with a long-term job contract against the benefit of having a technocrat who (i) invests more effort into the specialized policy task and (ii) is better insulated from the whims of public opinion. One natural application of the theory is in the field of monetary policy where the model provides a new theory of central bank independence. Mode of access: Internet Eggertsson, Gauti. IMF Working Papers; Working Paper ; No. 2007/091 Full text available on IMF http://elibrary.imf.org/view/journals/001/2007/091/001.2007.issue-091-en.xml IMF e-Library