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- A. Appendix: for online publication A.1. Data Sources and Transformations: Panel Regression The baseline data on chairman dismissal is compiled by Vuletin and Zhu (2011), and consists of 42 countries for the period 1972 through to 2006, of which 21 are advanced economies and 21 are developing countries. The additional variables used to estimate the empirical specification presented in section 2.2 are described below. Inflation Date on annual inflation is taken from the Global Financial Data.
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- Inflation volatility I calculate rolling window of 4 years to calculate standard deviation of inflation (Bowdler and Malik (2005)) to obtain a measure of inflation variability. My results are robust for window lengths of 3 and 5 years.
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- TOR rate Similar to Klomp and de Haan (2010), I calculate the turnover rate (TOR) using a rolling average over 4 years preceding a central bank governor change. According to Vuletin and Zhu (2011) using rolling windows to calculate average turnover rate of central bank governors allows for a more gradual and continuous institutional change. It is important to remark that because we calculate the rolling average over 4 years preceding a central bank governor change, we do not include current or future changes of central bank governor in our current calculation of TOR. This strategy purges reverse causality concerns, a crucial distinction because Dreher et al. (2008) find that past inflation increases the likelihood of a central banker to be replaced. My results are robust when calculating TOR over 2,3 and 5 years.
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