IDEAS home Printed from https://ideas.repec.org/a/kap/openec/v29y2018i1d10.1007_s11079-017-9447-y.html
   My bibliography  Save this article

Populism and Central Bank Independence

Author

Listed:
  • Charles Goodhart

    (London School of Economics)

  • Rosa Lastra

    (CCLS, Queen Mary University of London)

Abstract

The consensus that surrounded the granting of central bank independence in the pursuit of a price stability oriented monetary policy has been challenged in the aftermath of the global financial crisis, in the light of the rise of populism on the one hand and the expanded mandates of central banks on the other hand. After considering the economic case for independence and the three Ds (distributional, directional and duration effects), the paper examines three different dimensions in the debate of how the rise in populism - or simply general discontent with the status quo - affects central bank independence. Finally, the paper examines how to interpret the legality of central bank mandates, and whether or not central banks have exceeded their powers. This analysis leads us in turn to consider accountability and, in particular, the judicial review of central bank actions and decisions. It is important to have in place adequate mechanisms to ‘guard the guardians’ of monetary and financial stability.

Suggested Citation

  • Charles Goodhart & Rosa Lastra, 2018. "Populism and Central Bank Independence," Open Economies Review, Springer, vol. 29(1), pages 49-68, February.
    • Handle: RePEc:kap:openec:v:29:y:2018:i:1:d:10.1007_s11079-017-9447-y
    DOI: 10.1007/s11079-017-9447-y
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11079-017-9447-y
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11079-017-9447-y?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Dani Rodrik, 2018. "Populism and the economics of globalization," Journal of International Business Policy, Palgrave Macmillan, vol. 1(1), pages 12-33, June.
    2. Peter Conti-Brown, 2016. "The Power and Independence of the Federal Reserve," Economics Books, Princeton University Press, edition 1, number 10576.
    3. Hal S. Scott, 2015. "The Federal Reserve: The Weakest Lender of Last Resort Among Its Peers," International Finance, Wiley Blackwell, vol. 18(3), pages 321-342, December.
    4. Philip Arestis & Malcolm Sawyer (ed.), 2004. "The Rise of the Market," Books, Edward Elgar Publishing, number 3410.
    5. Mr. Ashraf Khan, 2017. "Central Bank Legal Frameworks in the Aftermath of the Global Financial Crisis," IMF Working Papers 2017/101, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Manuel Funke & Moritz Schularick & Christoph Trebesch, 2023. "Populist Leaders and the Economy," American Economic Review, American Economic Association, vol. 113(12), pages 3249-3288, December.
    2. Vigvári, Gábor, 2022. "Transzformáció és a populizmus a visegrádi országokban [Transformation and populism in the V4 countries]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(3), pages 339-366.
    3. Marco Manacorda & Guido Tabellini & Andrea Tesei, 2022. "Mobile internet and the rise of political tribalism in Europe," CEP Discussion Papers dp1877, Centre for Economic Performance, LSE.
    4. Matevž (Matt) Rašković & Katalin Takacs Haynes & Anastas Vangeli, 2024. "The emergence of populism as an institution and its recursive mechanisms: A socio-cognitive theory perspective," Journal of International Business Policy, Palgrave Macmillan, vol. 7(1), pages 19-40, March.
    5. Aggeborn, Linuz & Persson, Lovisa, 2017. "Public Finance and Right-Wing Populism," Working Paper Series 1182, Research Institute of Industrial Economics.
    6. Gianmarco Daniele & Amedeo Piolatto & Willem Sas, 2018. "Who Sent You? Strategic Voting, Transfers and Bailouts in a Federation," Working Papers. Serie AD 2018-05, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    7. Natascha Zaun & Ariadna Ripoll Servent, 2023. "Perpetuating Crisis as a Supply Strategy: The Role of (Nativist) Populist Governments in EU Policymaking on Refugee Distribution," Journal of Common Market Studies, Wiley Blackwell, vol. 61(3), pages 653-672, May.
    8. Gorynia Marian, 2019. "Competition and globalisation in economic sciences. Selected aspects," Economics and Business Review, Sciendo, vol. 5(3), pages 118-133, September.
    9. Keyan Lai, 2021. "National security and FDI policy ambiguity: A commentary," Journal of International Business Policy, Palgrave Macmillan, vol. 4(4), pages 496-505, December.
    10. Jerg Gutmann & Hans Pitlik & Andrea Fronaschütz, 2023. "Has the Russian invasion of Ukraine reinforced anti-globalization sentiment in Austria?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 50(2), pages 289-299, May.
    11. Harald Badinger & Volker Nitsch, 2019. "What Do Central Bankers Do? Evidence from the European Central Banks' Executive Board," CESifo Working Paper Series 7467, CESifo.
    12. Andrés Rodríguez-Pose & Neil Lee & Cornelius Lipp, 2021. "Golfing with Trump. Social capital, decline, inequality, and the rise of populism in the US," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 14(3), pages 457-481.
    13. Peter J. Boettke & Alexander W. Salter & Daniel J. Smith, 2018. "Money as meta-rule: Buchanan’s constitutional economics as a foundation for monetary stability," Public Choice, Springer, vol. 176(3), pages 529-555, September.
    14. Malte Dold & Tim Krieger, 2023. "The ideological use and abuse of Freiburg’s ordoliberalism," Public Choice, Springer, vol. 195(3), pages 341-361, June.
    15. Simon Hartmann & Thomas Lindner & Jakob Müllner & Jonas Puck, 2022. "Beyond the nation-state: Anchoring supranational institutions in international business research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(6), pages 1282-1306, August.
    16. Nikitas Konstantinidis & Konstantinos Matakos & Hande Mutlu-Eren, 2019. "“Take back control”? The effects of supranational integration on party-system polarization," The Review of International Organizations, Springer, vol. 14(2), pages 297-333, June.
    17. Malte Dold & Tim Krieger, 2019. "The “New” Crisis of the Liberal Order: Populism, Socioeconomic Imbalances, and the Response of Contemporary Ordoliberalism," Journal of Contextual Economics (JCE) – Schmollers Jahrbuch, Duncker & Humblot, Berlin, vol. 139(2–4), pages 243-258.
    18. Timothy M. Devinney & Christopher A. Hartwell & Jennifer Oetzel & Paul Vaaler, 2023. "Managing, theorizing, and policymaking in an age of sociopolitical uncertainty: Introduction to the special issue," Journal of International Business Policy, Palgrave Macmillan, vol. 6(2), pages 133-140, June.
    19. Alexander Mohr & Christian Schumacher, 2019. "The Contingent Effect of Patriotic Rhetoric on Firm Performance," Strategy Science, INFORMS, vol. 4(2), pages 94-110, June.
    20. Tiina Ritvala & Rebecca Piekkari, 2021. "Geopolitics of the knowledge-based economy," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(2), pages 334-337, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:openec:v:29:y:2018:i:1:d:10.1007_s11079-017-9447-y. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.