25 Years IWH

Professor Dr Stefan Eichler

Professor Dr Stefan Eichler
Current Position

since 10/16

Professor of International Monetary Economics 

TU Dresden

since 4/14

Head of the Research Group Financial Market Structure and Financial Stability

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

Research Interests

  • financial crises
  • monetary policy
  • exchange rates
  • international investment

Stefan Eichler is Professor for International Monetary Economics at TU Dresden since October 2016 as well as a member of the Department Financial Markets at IWH since April 2014. His research focuses on financial market structure and financial stability. 

Stefan Eichler studied economics at Chemnitz University of Technology and TU Dresden. He received his PhD from TU Dresden. Prior to joining IWH, he was Temporary Professor for Monetary Economics at TU Dresden, Junior Professor for International Macroeconomics and Finance at Otto von Guericke University Magdeburg, and Professor for International Money and Finance at the Leibniz University Hanover.

Your contact

Professor Dr Stefan Eichler
Professor Dr Stefan Eichler
Mitglied - Department Financial Markets
Send Message

Publications

cover_journal-of-banking-and-finance.jpg

Regional Banking Instability and FOMC Voting

Stefan Eichler Tom Lähner Felix Noth

in: Journal of Banking & Finance, 2018

Abstract

This study analyzes if regionally affiliated Federal Open Market Committee (FOMC) members take their districts’ regional banking sector instability into account when they vote. Considering the period 1979–2010, we find that a deterioration in a district's bank health increases the probability that this district's representative in the FOMC votes to ease interest rates. According to member-specific characteristics, the effect of regional banking sector instability on FOMC voting behavior is most pronounced for Bank presidents (as opposed to Governors) and FOMC members who have career backgrounds in the financial industry or who represent a district with a large banking sector.

read publication

cover_journal-of-forecasting.gif

Regional, Individual and Political Determinants of FOMC Members' Key Macroeconomic Forecasts

Stefan Eichler Tom Lähner

in: Journal of Forecasting, No. 1, 2018

Abstract

We study Federal Open Market Committee members' individual forecasts of inflation and unemployment in the period 1992–2004. Our results imply that Governors and Bank presidents forecast differently, with Governors submitting lower inflation and higher unemployment rate forecasts than bank presidents. For Bank presidents we find a regional bias, with higher district unemployment rates being associated with lower inflation and higher unemployment rate forecasts. Bank presidents' regional bias is more pronounced during the year prior to their elections or for nonvoting bank presidents. Career backgrounds or political affiliations also affect individual forecast behavior.

read publication

How Do Political Factors Shape the Bank Risk-Sovereign Risk Nexus in Emerging Markets?

Stefan Eichler

in: Review of Development Economics, No. 3, 2017

Abstract

This paper studies the role of political factors for determining the impact of banking sector distress on sovereign bond yield spreads for a sample of 19 emerging market economies in the period 1994–2013. Using interaction models, I find that the adverse impact of banking sector distress on sovereign solvency is less pronounced for countries with a high degree of political stability, a high level of power sharing within the government coalition, a low level of political constraint within the political system, and for countries run by powerful and effective governments. The electoral cycle pronounces the bank risk–sovereign risk transfer.

read publication

Working Papers

cover_DP_2017-22.jpg

Central Bank Transparency and the Volatility of Exchange Rates

Stefan Eichler Helge Littke

in: IWH Discussion Papers, No. 22, 2017

Abstract

We analyze the effect of monetary policy transparency on bilateral exchange rate volatility. We test the theoretical predictions of a stylized model using panel data for 62 currencies from 1998 to 2010. We find strong empirical evidence that an increase in the availability of information about monetary policy objectives decreases exchange rate volatility. Using interaction models, we find that this effect is more pronounced for countries with a lower flexibility of goods prices, a lower level of central bank conservatism, and a higher interest rate sensitivity of money demand.

read publication

cover_DP_2016-16.jpg

Central Bank Transparency and Cross-border Banking

Stefan Eichler Helge Littke Lena Tonzer

in: IWH Discussion Papers, No. 16, 2016
published in: Journal of International Money and Finance

Abstract

We analyze the effect of central bank transparency on cross-border bank activities. Based on a panel gravity model for cross-border bank claims for 21 home and 47 destination countries from 1998 to 2010, we find strong empirical evidence that a rise in central bank transparency in the destination country, on average, increases cross-border claims. Using interaction models, we find that the positive effect of central bank transparency on cross-border claims is only significant if the central bank is politically independent. Central bank transparency and credibility are thus considered complements by banks investing abroad.

read publication

cover_DP_2016-15.jpg

Regional Banking Instability and FOMC Voting

Stefan Eichler Tom Lähner Felix Noth

in: IWH Discussion Papers, No. 15, 2016
published in: Journal of Banking & Finance

Abstract

This study analyzes if regionally affiliated Federal Open Market Committee (FOMC) members take their districts’ regional banking sector instability into account when they vote. Considering the period from 1978 to 2010, we find that a deterioration in a district’s bank health increases the probability that this district’s representative in the FOMC votes to ease interest rates. According to member-specific characteristics, the effect of regional banking sector instability on FOMC voting behavior is most pronounced for Bank presidents (as opposed to governors) and FOMC members who have career backgrounds in the financial industry or who represent a district with a large banking sector.

read publication
Mitglied der Leibniz-Gemeinschaft LogoTotal-Equality-LogoWeltoffen Logo