Talking in a language that everyone can understand? Clarity of speeches by the ECB Executive Board

We use data on speeches held by members of the European Central Bank's (ECB) Executive Board to analyze whether the clarity of central bank communication has increased over time. Employing readability measures as proxy variables, we find that the clarity of information provision is trending upward since the inception of the ECB. The increase is gradual rather than being induced by changes in the board composition or major macroeconomic events. We also show that clarity is higher for speeches aimed at general audiences and for speeches by female speakers. Moreover, we find that higher clarity of speeches is associated with more optimistic media sentiment about the ECB and a stronger relationship between speech and media sentiment. • We analyze the linguistic complexity of speeches by ECB Executive Board members. • Readability measures such as the Flesch-Kincaid grade level are used to proxy clarity. • The clarity of speeches by ECB Executive Board members is trending upwards over time. • Higher clarity is associated with more optimistic media sentiment about the ECB. • Higher clarity strengthens the link between speech sentiment and media sentiment.

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Publication Details

Journal
Journal of International Money and Finance
Published
2024-10-02
DOI
https://doi.org/10.1016/j.jimonfin.2024.103200
Citations
9
Primary Topic
Taxation and Legal Issues
Type
article
Field-Weighted Citation Impact
8.52
Controls
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article

Talking in a language that everyone can understand? Clarity of speeches by the ECB Executive Board

Alexander Glas, Lena Bjerkander
9 citations
Journal of International Money and Finance
Taxation and Legal Issues
8.52
article

Talking in a language that everyone can understand? Clarity of speeches by the ECB Executive Board

Alexander Glas, Lena Bjerkander
article en
9 citations

Abstract

We use data on speeches held by members of the European Central Bank's (ECB) Executive Board to analyze whether the clarity of central bank communication has increased over time. Employing readability measures as proxy variables, we find that the clarity of information provision is trending upward since the inception of the ECB. The increase is gradual rather than being induced by changes in the board composition or major macroeconomic events. We also show that clarity is higher for speeches aimed at general audiences and for speeches by female speakers. Moreover, we find that higher clarity of speeches is associated with more optimistic media sentiment about the ECB and a stronger relationship between speech and media sentiment. • We analyze the linguistic complexity of speeches by ECB Executive Board members. • Readability measures such as the Flesch-Kincaid grade level are used to proxy clarity. • The clarity of speeches by ECB Executive Board members is trending upwards over time. • Higher clarity is associated with more optimistic media sentiment about the ECB. • Higher clarity strengthens the link between speech sentiment and media sentiment.

Journal of International Money and FinanceVol. 149
Centre for European Economic Research (DE), Friedrich-Alexander-Universität Erlangen-Nürnberg (DE)
Openalex Percentile: Top 3%
Taxation and Legal Issues
8.52
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