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The ECB: a reluctant leading character of the EMU play

Listed author(s):
  • Francesco Saraceno

    ()

    (OFCE-Sciences Po
    LUISS-SEP)

Abstract This paper assesses the performance of the European Central Bank (ECB) during the crisis that started in 2008. The ECB statute is consistent with a view of the economy that was predominant in the 1990s, that postulates a very limited role for discretional policies in managing the business cycle. The ECB had therefore to stretch its mandate in several occasions, during the crisis, to avoid severe outcomes. It was unable to avoid a slow but inexorable slide of the Eurozone towards deflation and a liquidity trap. To restore robust growth, fiscal policy should be used, and institutions should be redesigned away from the Berlin–Washington Consensus framework that shaped the Maastricht Treaty. Better rules for fiscal governance and a wider ECB mandate are proposed.

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File URL: http://link.springer.com/10.1007/s40888-016-0032-4
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Article provided by Springer & Fondazione Edison in its journal Economia Politica.

Volume (Year): 33 (2016)
Issue (Month): 2 (August)
Pages: 129-151

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Handle: RePEc:spr:epolit:v:33:y:2016:i:2:d:10.1007_s40888-016-0032-4
DOI: 10.1007/s40888-016-0032-4
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Order Information: Web: http://www.springer.com/economics/journal/40888

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  1. Christophe Blot & Jérôme Creel & Paul Hubert & Fabien Labondance, 2014. "Les enjeux du triple mandat de la BCE," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(3), pages 175-186.
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  8. Francesco Saraceno, 2015. "Challenges for the ECB in Times of Deflation," Sciences Po publications 183, Sciences Po.
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  14. Jérôme Creel & Paola Monperrus-Veroni & Francesco Saraceno, 2009. "On The Long-Term Effects Of Fiscal Policy In The United Kingdom: The Case For A Golden Rule," Scottish Journal of Political Economy, Scottish Economic Society, vol. 56(5), pages 580-607, November.
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  16. Francesco Saraceno & Roberto Tamborini, 2015. "How can it work ? On the impact of quantitative easing in the Eurozone," Sciences Po publications 2015/03, Sciences Po.
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