10 This reasoning suggests why one might expect future rounds of LSAPs to have diminishing returns. As noted earlier, the data make clear that past rounds of LSAPs have pushed down interest rates and term premiums.
Although the evidence for developing countries is more mixed, several studies have found that central bank independence promotes low inflation in those countries as well, especially when de facto rather than de jure measures of independence are used (Cukierman, Webb, and Neypati, 1992; Cukierman, Miller, and Neypati, 2002). The distinction between de facto and de jure central-bank independence remains important in the region.