Central Bank Transparency Grows Under Geraats's Pressure: Petra Geraats experienced the opacity of central banks first-hand. As a doctoral economics student at the University of California-Berkeley, she spent the summer of 1999 at the European Central Bank in Frankfurt. The paper she wrote said the infant institution should publish its economic forecasts.
On her return to the U.S., the ECB’s research department contacted her, asking her to remove mention of the bank from the study or postpone publication, she said. The reason: The bank’s Governing Council wasn’t ready to start publicizing its in-house outlook -- an example of “how incredibly insecure” ECB officials felt in the early days.
Geraats, now 40, kept the ECB in and the report was published through Berkeley. The bank eventually included her research in its working-paper series in January 2001 -- the same year it began announcing internal projections.
More than a decade later, Geraats, now a professor at the University of Cambridge, still hails the economic advantages of communication in monetary policy and has dedicated much of her academic career to its study. What’s changed is that more central banks are heeding her call for openness as a way of stimulating weak economic growth.
We all at Berkeley remember her as a remarkable student. We can't take much credit--the drive and the intelligence were always there…