board members accumulate various types of information useful for the bank's conduct of monetary policy through their analysis of the economic situation and financial market developments, the daily conduct of business operations, and exchanges of views with representatives from various fields. utilizing such information as well as knowledge, policy board members monitor carefully economic and financial developments. the details of the preparation for mpms are as follows. at least two business days prior to the mpm concerned, policy board members are provided with written reports prepared by the bank's staff, which the bank's staff later use at the beginning of the meeting to present an assessment of the current economic and financial situation. the reports include a comprehensive analysis of the economy based on available macro and micro economic information. in preparation for the mpm, members read through the staff's reports and formulate their views on the economic and financial situation, the outlook, and the appropriate direction of monetary policy. c. deliberations on the day of the mpm i will now outline a typical two - day mpm. the first day of the mpm usually starts at 2 : 00 p. m. the meeting is attended by policy board members and by government representatives, namely, the minister of finance and the minister of state for economic and fiscal policy or their designated delegates. executive directors of the bank in charge of departments directly concerned with monetary policy, and directors - general and other senior officials of departments concerned, attend mpms to report. others present at the mpm include staff of the mpm secretariat supporting the proceedings of mpms. the chairman of the policy board is elected by the board members from among themselves. the governor has so far always been the chairman. on the first day of the mpm, the staff present reports on recent economic and financial developments. specifically, the staff report developments including the results of the bank's money market operations and developments in the economy and financial markets in japan as well as those abroad. the meeting then moves on to a question - and - answer session between policy board members and the reporting staff. the second day of the mpm usually starts at 9 : 00 a. m. the meeting begins with a discussion among policy board members on economic and financial developments. first, each policy board member in turn expresses his or her views on recent economic and financial developments and the prospects for the future, taking into account the reports presented by the bank's staff on the previous day and other members'views. after all the members

sincerest form of flattery. in addition, there is no reason to have a monetary policy committee when the central bank is simply taking orders from its government. so the trend toward central bank independence opened the door to committee decisionmaking. " in addition, professor blinder summarizes the main arguments for preferring committee to individual decisionmaking under the following four points, 5 which seem to be consistent with the study on the boards of directors of u. s. corporations that i have just referred to. 1. " pooling : a committee pools the disparate knowledge of its individual members. 2. diversity : members of a committee bring different decisionmaking heuristics to a complex problem. see bainbridge ( 2002 ). see fujiki ( 2005 ) for references to the related literature. see blinder ( 2006a, b ). see blinder ( 2006b ). 3. checks and balances : committees are less likely to adopt extreme or idiosyncratic positions. 4. reduced volatility : owing to “ averaging ” ( which need not be interpreted literally ), the decisions of a group are likely to be less volatile. " with regard to the fourth point, however, professor blinder argues that it " might conceivably be turned around and viewed as a vice instead because one person's low volatility is another's excessive inertia. " professor anne sibert of the university of london notes free riding and group polarization as possible shortcomings of group decisionmaking. 6 with regard to the first issue, she points out that the free - riding problem can occur, for example, in gathering information and that larger committees are more likely to encounter this problem than smaller committees. however, i do not believe that the free - riding problem is likely to emerge in decisionmaking in committees based on my experience at the bank, where each member participates in the decisionmaking autonomously and independently. with regard to the issue of group polarization, biased group membership and heated deliberations make the views of individual members less moderate or more extreme. group polarization can be inconsistent with excessive inertia, which is noted by professor blinder. professor sibert also says that it is debatable whether moderation or polarization is a good thing. in my experience, group polarization is unlikely to occur if members of the committee have profound experience and diversified backgrounds. summarizing what i have referred to and mentioned so far, the