Regularly canvassing the views of the public, on the economy and on the setting of monetary policy, would be one way of harnessing that wisdom. This would allow central banks to listen to a potentially much wider and richer array of views on the setting of policy, in particular from those who might otherwise be distant, disenfranchised or distrustful of central banks and their actions. It would open central banks’ ears (and eyebrows) to a wider range of societal stakeholders when setting policy. The information provided from the public could serve as another input to the policy-setting process, much as monetary policy rules (and other data) do today. What are the public telling us about the right setting of policy and why? Clearly, neither rules nor polls should be followed slavishly - the scope for misinformation and mishap is simply too great. And the whole purpose of delegating policy to an independent third-party is to avoid the short-termism that may sometimes affect the general public. Nonetheless, if crowds, like rules, sometimes contain wisdom – different perspectives, different views, different narratives – then harvesting this information could be an important additional input into the policy 79 80 81  Earle et al (2016). Mackay (1841). Tetlock and Gardner (2016). 26  All speeches are available online at www.bankofengland.co.uk/speeches  26  process. It would help reach, and solicit direct feedback from, those parts of society otherwise out of central banks’ reach. And it may, as a by-product, also improve public understanding of policy and the economy.
42  Economists were towards the  bottom of this list, well below scientists, historians, weather forecasters and even sports commentators  39  Akerlof and Shiller (2009), Shiller (2017). Shiller (2017). Elsewhere, I have called this widening trust gap the Great Divide (Haldane, 2016). 42 YouGov (2016). 40 41  10  All speeches are available online at www.bankofengland.co.uk/speeches  10  (Chart 11). There is always someone worse off than you – in this case it was politicians – but the overall picture is discouraging. If trust in institutions is low, and if trust in economists is low, the backdrop is not propitious for institutions containing (lots of) economists. So it is with central banks. Chart 12 shows some measures of trust or confidence in the four major central banks over the past decade. In the UK, the US and the euro area, trust has fallen over that period, often coincident with the global financial crisis. The Bank of Japan has been an exception, although its financial crisis came rather earlier. If we turn from trust to understanding, the picture is similar. In 1997, Robert Shiller conducted a survey of public attitudes towards inflation. He concluded then: “there will probably always be a communications gap between economists and the public. But there appears to be rather more of a gap than most of us would have expected”. 43  In the period since, there is little evidence this gap has closed.