JAN 21 2010

Cost of Transparency

Federal Reserve System

A paper describing circumstances wherein welfare is increased by suppressing information that generates excess volatility in the price of an asset or currency around its long run valueis available at: http://research.stlouisfed.org/wp/2010/2010-001.pdf . Apparently, the author, a Federal Reserve Bank vice president, doesn’t accept the notion of inequity aversion or behavioral economics in general. I hope…

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