as a cyclical buffer. how was this justified? the arguments put forward were : • the classical dichotomy between prices and activity : money does not affect activity ; • what might be called the “ tinbergen proposition ” : with one instrument, only one goal can be achieved ; • political economy reasons - - usually associated with “ time inconsistency ” arguments ; • a simple, unambiguous commitment to price stability anchors price expectations most effectively, and this benefit is worth the cost that might come from ignoring activity ; • the lags in recognition and implementation of policy are so long that activity stabilisation is futile or even counter - productive. i have looked at these in some detail in an earlier paper ( grenville 1996 ), so i will be brief here. the classical dichotomy between prices and activity reminds central bankers of their long - term priorities, but even though the long - run phillips curve may be vertical, the short - run curves are certainly not. the tinbergen proposition is superficially attractive, but not much help in practical decision - making. trade - offs between various objectives are common to policy - making ( and just about every aspect of life ), and these trade - offs have to be handled by a weighing of the conflicting objectives, not by ignoring one of them. the “ political economy ” aspects have been prominent in the academic literature, and some very neat models can be built to illustrate the issues of time inconsistency. the models usually involve the “ monetary authorities ” ( no distinction is made between governments and central banks ) making an ex ante commitment to price stability, but reneging on this to squeeze higher activity in the short term, in the form of an “ inflation surprise ” ( kydland and prescott 1977 ). the simple versions of the arguments have never appealed much to central bankers who believe that their own reputation is at stake and who, because of this, are unlikely to exploit the short - term phillips curve trade - off. to see central bankers as congenitally inclined to administer “ inflation surprises ” does not seem to capture their true character. 3 if there is a problem here, it seems more likely to lie in the political interaction of policy - making between governments and central banks and it is best addressed by greater independence, not by imposing a single objective on the central bank. what about the role of a simple single price objective in anchoring price expectations? a decade or so ago, there

elson gaskin : the frank collymore literary endowment - building on its legacy remarks by mr elson gaskin, deputy governor of the central bank of barbados, at the 26th frank collymore literary endowment awards ceremony, bridgetown, 14 january 2024. * * * good evening. in commencing, let me, on behalf of the governor, board, management and staff of the central bank of barbados, extend condolences to the family, friends, and loved ones of the late sonia williams, who on more than one occasion was a finalist in this competition. as i began to prepare for this awards ceremony, i looked back at what we have said on previous occasions as it is sometimes important to take a retrospect before moving forward. what stood out during that exercise is that we have often spoken about the role that the arts play in creating a national identity. just last year, we spoke about the fact that not only is the fcle a part of the bank's legacy, it has created a legacy of its own. the central bank of barbados'unswerving support for and commitment to the frank collymore literary endowment is precisely because we recognise that in addition to fulfilling our core mandate, we must be a part of, and never apart from, the society we serve. we see this programme as an essential part of the barbadiana that we are. one year ago, the bank was winding down its 50th anniversary celebrations and the fcle was marking its silver jubilee. the parallels between the two institutions - and i choose this word deliberately because the frank collymore literary endowment has become an institution - extend beyond celebrating milestone anniversaries around the same time. both are interested in barbados'national development. for the bank, that is primarily, but not exclusively, related to the economy. for the fcle, it is about the development of this island's literary tradition. it is a role we both take seriously, and from which comes a second parallel : our respective commitment to excellence. the central bank of barbados'vision is to become and maintain an institution of worldclass excellence, and we are working every day to internalise this vision and reflect it in not only in the many activities in which we are involved an but also in the quality with which we execute them. i am confident that the fcle and its committee also live by this ideal. over the past 26 years, the competition has become a bellwether of quality writing.