Yaryna Samusevych
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The impact of governance quality on central bank’s independence
Tetiana Vasylieva , Viktoria Dudchenko , Yaryna Samusevych , Anton Marci , Vadym Sofronov doi: http://dx.doi.org/10.21511/pmf.11(1).2022.10Public and Municipal Finance Volume 11, 2022 Issue #1 pp. 113-127
Views: 390 Downloads: 84 TO CITE АНОТАЦІЯThe stable functioning of the public finance system requires a rational regulatory apparatus. The central bank occupies a special place in this system. Science and practice prove that the central bank’s political and economic independence determines its effectiveness. Thus, it is crucial to determine the prerequisites for ensuring its independence. The study aims to assess the influence of governance quality on the central bank’s independence, considering the variance of the socio-political development of countries. The analysis was conducted based on 53 countries. Panel regression modeling with random effects was chosen as a research method. The analysis approach involves calculations for the groups of countries that differ in social and political development parameters according to the following criteria: the initial level of the central bank independence; level of human development; political rights freedom; level of civil liberties; and political regime.
Socio-political factors significantly affect the central bank’s independence in the following conditions: a high initial level of independence of the central bank, a high level of human development, and an average level of political and civil freedom. At the same time, the governance quality ensures the growth of the central bank’s independence regardless of the countries’ political regime. Three factors have the most significant influence on ensuring the independence of the central bank, namely “government efficiency,” “quality of regulation,” and “rule of law.” -
Central bank independence as a prerequisite for ensuring price stability: Modeling the role of the national pattern
Atik Kerimov , Azer Babayev , Viktoria Dudchenko , Yaryna Samusevych , Martina Podmanicka doi: http://dx.doi.org/10.21511/bbs.18(4).2023.25Banks and Bank Systems Volume 18, 2023 Issue #4 pp. 307-319
Views: 180 Downloads: 79 TO CITE АНОТАЦІЯEnsuring price stability is a dominant function of the central bank. Empirical studies on various statistical samples give conflicting results regarding the influence of central bank independence on the inflation rate. The study offers a methodology for assessing the role of the formation of a national pattern of central bank independence in ensuring price stability. Calculations were made for 53 countries of the world using a combination of cluster analysis tools and panel regression modeling. The cluster analysis carried out at different time intervals of the study allowed defining three patterns of the formation of central bank independence. The changes in the clusters characterizing the peculiarities of the national patterns of central bank independence shows that for a number of countries there is no stable national pattern. Modeling based on panel data showed that when forming a country pattern “Limited level of central bank independence”, an increase in the level of independence of the central bank by one unit on average leads to an increase in the inflation rate by 7.09%. On the other hand, in the countries with the national patterns of central bank independence “Dominance of the institutional and financial component of ensuring the independence of the central bank” and “Dominance of the personal and functional component of ensuring the independence of the central bank”, the expected consequence of increasing the level of independence of the central bank by one unit is to reduce the inflation rate by an average of 3.32% and 6.03%, respectively.
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Banking system stability in crisis periods: The impact of the banking regulator independence
Atik Kerimov , Azer Babayev , Viktoria Dudchenko , Yaryna Samusevych , Milos Tumpach doi: http://dx.doi.org/10.21511/bbs.18(3).2023.18Banks and Bank Systems Volume 18, 2023 Issue #3 pp. 221-234
Views: 355 Downloads: 104 TO CITE АНОТАЦІЯLocal and global financial crises are caused by a wide range of geopolitical, macro-financial, and socio-economic determinants. The purpose of this study is to assess the role of central bank independence in preventing financial crises and mitigating their consequences. Two hypotheses were tested. A measure of the banking regulator independence is the CWN index of the central bank independence. The hypotheses were tested on data from 53 countries suffering from financial crises over the last 40 years (the sample includes both developed and developing countries from different continents). The tools of nonlinear logit regression (modeling the probability of loss of financial stability due to a financial crisis, considering different levels of the banking regulator independence) and panel regression with random effects (modeling the influence of the banking regulator independence on banking activities during crisis periods) were used for calculations. The study did not confirm that a high level of central bank independence is a necessary condition for preventing the occurrence of financial crises in the national economy. On the contrary, the likelihood of financial instability was found to be higher in countries with more independent central banks. Thus, during crisis periods, an increase in the CWN index by 1 ensures an increase in the regulatory capital adequacy parameter by an average of 0.28%, a decrease in return on assets by 0.59%, and an increase in the share of non-performing loans by 1.69%.
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