Conference 2014: Andy Haldane speech – Central Bank psychology

“Simply recognising the cognitive constraints on decision-making is thus a first step towards making policy robust to them. So too is institutional design

Speech given by Andrew G Haldane, Bank of England Chief Economist,
Leadership: stress and hubris conference hosted by the Royal Society of Medicine, London
17 November 2014

While hubris remains a non-topic in many organisations, it is certainly recognised by the UK’s Bank of England as one of the biases that may affect its leaders’ decision-making.

In his speech to our 2014 Conference, the Bank’s chief economist Andy Haldane discussed how the institutional design of the organisation has been structured to minimise the effects of hubris and other “cognitive ticks” that can affect human decision-making.

“I wish to argue that the evolution of central bank policy frameworks over recent years can be seen as an attempt to make them robust to psychological biases. I want to illustrate that by reference to the Bank of England’s policy framework. And, based on that analysis, I want to suggest some areas where a further evolutionary “nudge” in those frameworks might be warranted.”

The Conference ‘Leadership: stress and hubris’ was held in conjunction with the British Psychological Society’s Division of Occupational Psychology at the Royal Society of Medicine in London on Monday 17 November 2014.

Read the full notes of Andy Haldane’s address here: AHaldanespeech-2

More materials from the conference will be uploaded as they come to hand.