Skip to main content Accessibility help

A textual Taylor rule: estimating central bank preferences combining topic and scaling methods

  • Nicole Baerg (a1) and Will Lowe (a2)


Scholars often use voting data to estimate central bankers’ policy preferences but consensus voting is commonplace. To get around this, we combine topic-based text analysis and scaling methods to generate theoretically motivated comparative measures of central bank preferences on the US Federal Open Market Committee (FOMC) leading up to the financial crisis in a way that does not depend on voting behavior. We apply these measures to a number of applications in the literature. For example, we find that FOMC members that are Federal Reserve Bank Presidents from districts experiencing higher unemployment are also more likely to emphasize unemployment in their speech. We also confirm that committee members on schedule to vote are more likely to express consensus opinion than their off schedule voting counterparts.


Corresponding author

*Corresponding author. Email:


Hide All

An earlier version of this project was developed for NLP Unshared Task in PoliInformatics 2014.



Hide All
Acosta, M Meade, EE (2015) Hanging on Every Word: Semantic Analysis of the FOMC’s Postmeeting Statement. Washington, DC: FEDS Notes Board of Governors of the Federal Reserve System.
Adolph, C (2013) Bankers, Bureaucrats, and Central Bank Politics: The Myth of Neutrality. New York: Cambridge University Press.
Ainsley, C (2017) The Politics of Central Bank Appointments. The Journal of Politics 79(4), 12051219.
Bennani, H, Farvaque, E Stanek, P (2018) Influence of Regional Cycles and Personal Background on FOMC Members’ Preferences and Disagreement. Economic Modelling 68, 416424.
Blei, DM, Ng, AY Jordan, MI. (2003) Latent Dirichlet Allocation. Journal of Machine Learning Research 3, 9931022.
Blinder, AS Reis, R (2005) ‘Understanding the Greenspan Standard’. Proceedings of Economic Policy Symposium - Jackson Hole. Federal reserve Bank of Kansas City, Issue (August), 1196.
Carroll, R, Lewis, JB, Lo, J, Poole, KT Rosenthal, H (2009) Comparing NOMINATE and IDEAL: Points of Difference and Monte Carlo Tests. Legislative Studies Quarterly 34(4), 555591.
Chang, J, Boyd-Graber, J, Gerrish, S, Wang, C Blei, DM. (2009) ‘Reading Tea Leaves: How Humans Interpret Topic Models’. Proceedings of the 23rd Annual Conference on Neural Information Processing Systems, pp. 288296.
Chang, KH (2003) Appointing Central Bankers: The Politics of Monetary Policy in the United States and the European Monetary Union. New York: Cambridge University Press.
Chappell, HW, Havrilesky, TM McGregor, RR (1995) Policymakers, Institutions, and Central Bank Decisions. Journal of Economics and Business 47(2), 113136.
Chappell, HW, Havrilesky, TM McGregor, RR (2000) Monetary Policy Preferences of Individual FOMC Members: A Content Analysis of the Memoranda of Discussion. The Review of Economics and Statistics 79(3), 454460.
Chappell, HW Jr, Havrilesky, TM McGregor, RR (1993) Partisan Monetary Policies: Presidential Influence Through the Power of Appointment. The Quarterly Journal of Economics 108(1), 185218.
Clinton, J, Jackman, S Rivers, D (2004) The Statistical Analysis of Roll Call Data. American Political Science Review 98(2), 116.
Crawford, VP Haller, H (1990) Learning How to Cooperate: Optimal Play in Repeated Coordination Games. Econometrica 58(3), 571595.
Eichler, S Lähner, T (2014) Forecast Dispersion, Dissenting Votes, and Monetary Policy Preferences of FOMC Members: The Role of Individual Career Characteristics and Political Aspects. Public Choice 160(3–4), 429453.
Eijffinger, S, Mahieu, R Raes, L (2018) Inferring Hawks and Doves from Voting Records. European Journal of Political Economy 51(C), 107120.
El-Shagi, M Jung, A (2015) Does the Greenspan Era Provide Evidence on Leadership in the FOMC? Journal of Macroeconomics 43, 173190.
Gerlach-Kristen, P Meade, EE (2010) ‘Is There a Limit on FOMC Dissents? Evidence from the Greenspan Era’. Working Paper 2010-16, American University, Department of Economics.
Goodman, LA (1985) The Analysis of Cross-Classified Data Having Ordered and/or Unordered Categories: Association Models, Correlation Models, and Asymmetry Models for Contingency Tables With or Without Missing Entries. The Annals of Statistics 13(1), 1069.
Gordon, DB Leeper, EM (1994) The Dynamic Impacts of Monetary Policy: An Exercise in Tentative Identification. Journal of Political Economy 102(6), 12281247.
Hallerberg, M Wehner, J (2018) When Do You Get Economists as Policy Makers? British Journal of Political Science, 113.
Havrilesky, T Gildea, J (1991) The Policy Preferences of FOMC Members as Revealed by Dissenting Votes: Comment. Journal of Money, Credit, and Banking 23(1), 130138.
Havrilesky, T Gildea, J (1995) The Biases of Federal Reserve Bank Presidents. Economic Inquiry 33(2), 274284.
Hayo, B Méon, P-G (2013) Behind Closed Doors: Revealing the ECB’s Decision Rule. Journal of International Money and Finance 37, 135160.
Hix, S, Høyland, B Vivyan, N (2010) From Doves to Hawks: A Spatial Analysis of Voting in the Monetary Policy Committee of the Bank of England. European Journal of Political Research 49(6), 731758.
Johnson, J (2016) Priests of Prosperity: How Central Bankers Transformed the Postcommunist World. Ithaca: Cornell University Press.
Kaplan, SB (2017) Partisan Technocratic Cycles in Latin America. Electoral Studies 45, 219229.
Lauderdale, BE Clark, TS (2014) Scaling Politically Meaningful Dimensions Using Texts and Votes. American Journal of Political Science 58(3), 754771.
Lowe, W, Benoit, K, Laver, M Mikhaylov, S (2011) Scaling Policy Positions from Coded Units of Political Texts. Legislative Studies Quarterly 36(1), 123155.
Lucas, C, Nielsen, RA, Roberts, ME, Stewart, BM, Storer, A Tingley, D (2015) Computer-assisted text analysis for comparative politics. Political Analysis 23(2), 254277.
Meade, EE (2005) The FOMC: Preferences, Voting, and Consensus. Federal Reserve Bank of St. Louis Review 87(2), 93101.
Meade, EE Sheets, DN (2005) Regional Influences on FOMC Voting Patterns. Journal of Money, Credit, and Banking 37(4), 661677.
Meade, EE Nathan Sheets, D (2005) Regional Influences on FOMC Voting Patterns. Journal of Money, Credit and Banking 37, 661677.
Meade, EE Stasavage, D (2008) Publicity of Debate and the Incentive to Dissent: Evidence from the US Federal Reserve. The Economic Journal 118(528), 695717.
Plosser, CI (2014) Monetary Rules: Theory and Practice. Journal of Economic Dynamics and Control 49, 144146.
Poole, KT Rosenthal, H (1997) Congress: A Political-Economic History of Roll Call Voting. New York: Oxford University Press.
Proksch, S-O Slapin, JB (2012) Institutional Foundations of Legislative Speech. American Journal of Political Science 56, 520537.
Riboni, A Ruge-Murcia, FJ (2010) Monetary Policy by Committee: Consensus, Chairman Dominance, or Simple Majority? The Quarterly Journal of Economics 125(1), 363416.
Roberts, ME, Stewart, BM, Tingley, D, Lucas, C, Leder-Luis, J, Gadarian, SK, Albertson, B Rand, DG (2014) Structural Topic Models for Open-Ended Survey Responses. American Journal of Political Science 58(4), 10641082.
Rosa, C Verga, G (2007) On the Consistency and Effectiveness of Central Bank Communication: Evidence from the ECB. European Journal of Political Economy 23, 146175.
Schelling, T (1978) Micromotives and Macrobehavior. Toronto: George J. McLeod Ltd.
Schonhardt-Bailey, C (2013) Deliberating American Monetary Policy: A Textual Analysis. Boston: MIT Press.
Schwarz, D, Traber, D Benoit, K (2017) Estimating Intra-Party Preferences: Comparing Speeches to Votes. Political Science Research and Methods 5(2), 379396.
Shapiro, C Varian, HR (2013) Information Rules: A Strategic Guide to the Network Economy. Boston: Harvard Business Press.
Slapin, JB Proksch, S-O (2008) A Scaling Model for Estimating Time-Series Party Positions from Texts. American Journal of Political Science 52(3), 705722.
Taylor, J (1993) ‘Discretion vs Policy Rules in Practice’. Carnegie Rochester Conference Series on Public Policy, North Holland, pp. 195214.
Thornton, DL Wheelock, DC (2014) Making Sense of the Dissents: A History of FOMC Dissents. Federal Reserve Bank of St. Louis Review 96(3), 213227.
Tootell, GMB (1996) Appointment Procedures and FOMC Voting Behavior. Southern Economic Journal 63, 191204.
Wang, X, McCallum, A Wei, X (2007) ‘Topical n-Grams: Phrase and Topic Discovery, with an Application to Information Retrieval’. Proceedings of the 7th IEEE International Conference on Data Mining, Chapel Hill, 28-31 October.
Warsh, K (2014) Transparency and the Bank of England’s Monetary Policy Committee. A review. Available at, accessed 3 January 2016.
Woodford, M (2005) ‘Central Bank Communication and Policy Effectiveness’. NBER Working Paper No. 11898, National Bureau of Economic Research, Federal Reserve Bank of Kansas City, 399474.

Related content

Powered by UNSILO
Type Description Title
Supplementary materials

Baerg and Lowe supplementary material

 PDF (346 KB)
346 KB
Supplementary materials

Baerg and Lowe Dataset


A textual Taylor rule: estimating central bank preferences combining topic and scaling methods

  • Nicole Baerg (a1) and Will Lowe (a2)


Altmetric attention score

Full text views

Total number of HTML views: 0
Total number of PDF views: 0 *
Loading metrics...

Abstract views

Total abstract views: 0 *
Loading metrics...

* Views captured on Cambridge Core between <date>. This data will be updated every 24 hours.

Usage data cannot currently be displayed.