[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"detail-sidebar-cat-0-en-105":3,"doc-seo-324481-105":59,"doc-detail-324481-en":130},{"code":4,"msg":5,"data":6},0,"success",[7,13,18,23,28,33,38,43,48,51,55],{"id":8,"doc_module":4,"doc_module_name":9,"category_name":10,"show_sort_weight":11,"slug":12},1,"Document","Story & Novel",90,"story-novel",{"id":14,"doc_module":4,"doc_module_name":9,"category_name":15,"show_sort_weight":16,"slug":17},2,"Literature",80,"literature",{"id":19,"doc_module":4,"doc_module_name":9,"category_name":20,"show_sort_weight":21,"slug":22},4,"Exam",70,"exam",{"id":24,"doc_module":4,"doc_module_name":9,"category_name":25,"show_sort_weight":26,"slug":27},5,"Comic",60,"comic",{"id":29,"doc_module":4,"doc_module_name":9,"category_name":30,"show_sort_weight":31,"slug":32},6,"Technology",50,"technology",{"id":34,"doc_module":4,"doc_module_name":9,"category_name":35,"show_sort_weight":36,"slug":37},7,"Healthcare",40,"healthcare",{"id":39,"doc_module":4,"doc_module_name":9,"category_name":40,"show_sort_weight":41,"slug":42},8,"Research & Report",30,"research-report",{"id":44,"doc_module":4,"doc_module_name":9,"category_name":45,"show_sort_weight":46,"slug":47},9,"Religion & Spirituality",20,"religion-spirituality",{"id":46,"doc_module":4,"doc_module_name":9,"category_name":49,"show_sort_weight":46,"slug":50},"World Cup","world-cup",{"id":52,"doc_module":4,"doc_module_name":9,"category_name":53,"show_sort_weight":52,"slug":54},10,"Lifestyle","lifestyle",{"id":56,"doc_module":4,"doc_module_name":9,"category_name":57,"show_sort_weight":24,"slug":58},19,"General","general",{"code":4,"msg":60,"data":61},"ok",{"site_id":62,"language":63,"slug":64,"title":65,"keywords":66,"description":67,"schema_data":68,"social_meta":123,"head_meta":125,"extra_data":127,"updated_unix":129},105,"en","three-myths-about-central-banks","Three Myths about Central Banks","","A scholarly commentary by Geoffrey P. Miller examines widely held beliefs about central banks and tests them against historical and analytical evidence. It challenges the myth of central bank omnipotence by analyzing the Bank of Japan’s constrained ability to counter the 1987–1990 bubble and subsequent stagnation. It also disputes the view that price stability should be central banks’ only non-discretionary goal, introducing a rule-based stability thought experiment and arguing that the evidence does not support excessive popular claims of power.",{"@graph":69,"@context":122},[70,84,105],{"@type":71,"itemListElement":72},"BreadcrumbList",[73,77,79,82],{"item":74,"name":75,"@type":76,"position":8},"https://docshare.wps.com","Home","ListItem",{"item":78,"name":9,"@type":76,"position":14},"https://docshare.wps.com/document/",{"item":80,"name":40,"@type":76,"position":81},"https://docshare.wps.com/document/research-report/",3,{"item":83,"name":65,"@type":76,"position":19},"https://docshare.wps.com/document/three-myths-about-central-banks/324481/",{"url":83,"name":65,"@type":85,"image":86,"author":91,"headline":65,"publisher":94,"fileFormat":97,"inLanguage":63,"description":67,"dateModified":98,"datePublished":99,"encodingFormat":97,"isAccessibleForFree":100,"interactionStatistic":101},"DigitalDocument",{"url":87,"@type":88,"width":89,"height":90},"https://docshare.wps.com/thumbnails/three-myths-about-central-banks/324481.png","ImageObject",300,407,{"name":92,"@type":93},"Patrick","Person",{"url":74,"name":95,"@type":96},"DocShare","Organization","application/pdf","2026-11-08","2026-09-21",true,{"@type":102,"interactionType":103,"userInteractionCount":39},"InteractionCounter",{"@type":104},"ViewAction",{"@type":106,"mainEntity":107},"FAQPage",[108,114,118],{"name":109,"@type":110,"acceptedAnswer":111},"What is the first myth about central banks discussed in the commentary?","Question",{"text":112,"@type":113},"The commentary addresses the belief that central banks are omnipotent—responsible for controlling the business cycle and ensuring continuous prosperity.","Answer",{"name":115,"@type":110,"acceptedAnswer":116},"Why does the commentary argue that the Bank of Japan was not nearly as responsible for Japan’s bubble as many think?",{"text":117,"@type":113},"It argues the BOJ was constrained: it was unclear early on that Japan faced a speculative bubble, the bubble didn’t show in price indexes, monetary tools were too broad for sectoral issues, and foreign and domestic political considerations limited action.",{"name":119,"@type":110,"acceptedAnswer":120},"What second myth about central banks does the commentary address after the section on omnipotence?",{"text":121,"@type":113},"It examines the belief that central banks’ only monetary policy function should be maintaining price stability, and it questions this through a rule-based thought experiment.","https://schema.org",{"og:url":83,"og:type":124,"og:title":65,"og:site_name":95,"og:description":67},"article",{"robots":126,"canonical":83},"index,follow",{"doc_id":128,"site_id":62},324481,1790215910,{"code":4,"msg":5,"data":131},{"doc_id":128,"user_id":132,"nickname":92,"user_avatar":133,"doc_module":4,"category_id":39,"category_name":40,"doc_title":65,"doc_description":67,"doc_content":134,"file_id":135,"file_url":136,"file_type":137,"file_size":138,"view_count":39,"is_deleted":4,"is_public":8,"is_downloadable":8,"audit_status":8,"page_count":24,"language":139,"language_code":63,"site_id":62,"html_lang":63,"table_of_contents":140,"faqs":141,"seo_title":142,"seo_description":67,"update_tm":143,"read_time":144,"preview_page_count":4},549758146520,"https://ap-avatar.wpscdn.com/avatar/80002397d8c0411e94?_k=1775819394049821470","by Geoffrey P.Miller  \nOerthe ps decad,cnta bnkshave emerged from relative obscurityto global recognition as one of the mostpowerful institutions in the worldpowerful not only economically,but alsopolitically,socially,and as forces forcultural and historical change.Associ-ated with this new image areseveral ideas about central banks that,while often not clearly expressed,arenevertheless widely held.These ideascirculate in a sort of folklore ororaltradition.They exercise a significantinfluence on how central banks areperceived.  \n■ Central Bank OmnipotenceThe first of these ideas is that of centralbank omnipotence.There seems to be ageneral public perception that a centralbank is responsible for controlling thebusiness cycle and for ensuring an end-less stream of prosperity.This isn'taview that is held by central bankersthemselves,although they benefit tosome extent if the public holds them in asort of awed semiadulation.  \nWe see this idea at play today.In theUnited States,for example.the FederalReserve System is credited for theperiod ofeconomic expansion and pricestability that we have enjoyed for manyof the past years.The Fed is also blamedfor the recent economic slowdown;ifonly the central bank had loosenedcredit earlier,we hear,we would nothave faced the layoffs,lack of consumerconfidence,deteriorating corporate prof-its,and so on that were grist for businessnews over the past few years.But is theFed really so powerful?  \nWe can't easily determine the degree ofcentral bank influence.No controlledexperiments are available.However,  \n# Three Myths about Central Banks\n\nthere's reason to believe that centralbank powers,although very large,arestill significantly limited.  \nOne object lesson on this is the role ofthe Bank of Japan(BOJ)over the past15 years.Many have criticized the BOJfor contributing to,even creating,thebubble economy of 1987-1990,whosecollapse was followed by more than adecade of economic stagnation in thatcountry.A governor of the BOJ evenaccepted blame for the failure.  \nYet my research suggests the Bank wasnot nearly as responsible as many think(see \"The Role of a Central Bank in aBubble Economy,\"by Geoffrey P.Miller,in the Cardozo Law Review,1996).It was highly constrained in itsability to act against the bubble econ-omy,for several reasons.It wasn't clear,at least in the early years,that Japan was,in fact,in the midst of a speculativebubble;many argued that the upsurge inJapanese equity and real estate priceswas due to economic fundamentals.The bubble economy didn't show up inthe wholesale or retai price indexes,sothe Bank could not easily justify inter-vention as an inflation-control measure.  \nTools of monetary policy were too broadin scope to deal effectively with sectoralphenomena;the Bank's intervention wasgoing to affect the economy as a wholerather than the limited areas of stockmarket and real estate prices.The Bankalso had to take foreign relations intoaccount,especially relations with theUnited States.BOJ credit tighteningwould have been seen by the UnitedStates as inconsistent with commitmentsthe Japanese government had made tostimulate domestic spending in order toincrease demand for U.S.goods.The  \nNovember 2002  \nDo central banks control the businesscycle?Should price stability be theironly monetary policy goal?Do politi-cians give up a degree of power andgain nothing personally when theygrant central banks independence?This Commentary argues that none ofthese widely held notions is true.TheCommentary is based on a speech pre-sented to participants at the conferenceon the Origins and Evolution of Cen-tral Banking,sponsored by the CentralBank Institute of the Federal ReserveBank of Cleveland,in May 2001.  \nUnited States was also very concernedthat Japan not do anything to destabilizeits stock market,given the perceptionafter October 1987 that U.S.equitymarkets were fragile.  \nFinally,the BOJ had to deal with power-ful figures inside Japan who were profit-ing enormously from the bubble econ-om","cbCaia0y83Tg7i9u","https://ap.wps.com/l/cbCaia0y83Tg7i9u","pdf",1158045,"English","# Three Myths about Central Banks\n## ■ The Talisman of Price-Level Control","[{\"question\":\"What is the first myth about central banks discussed in the commentary?\",\"answer\":\"The commentary addresses the belief that central banks are omnipotent—responsible for controlling the business cycle and ensuring continuous prosperity.\"},{\"question\":\"Why does the commentary argue that the Bank of Japan was not nearly as responsible for Japan’s bubble as many think?\",\"answer\":\"It argues the BOJ was constrained: it was unclear early on that Japan faced a speculative bubble, the bubble didn’t show in price indexes, monetary tools were too broad for sectoral issues, and foreign and domestic political considerations limited action.\"},{\"question\":\"What second myth about central banks does the commentary address after the section on omnipotence?\",\"answer\":\"It examines the belief that central banks’ only monetary policy function should be maintaining price stability, and it questions this through a rule-based thought experiment.\"}]","Three Myths about Central Banks | PDF",1789968041,13]