On the efficiency-legitimacy trade-off in EMU
This paper addresses the question whether the process of European monetary integration implies efficiency-legitimacy trade-off. The paper considers that the process of monetary policy delegation to the European Central Bank (ECB), ratified by all European Union (EU) parliaments, was a non-zero-sum game, increasing both the efficiency and the legitimacy of monetary policy in the eurozone. There was however a change in the nature of delegation: the initial principal (EU national governments and/or parliaments) delegated to the agent (the ECB) control over its behaviour in regard to monetary policy. The paper distinguishes two types of constraints for monetary policy: credibility constraints and political constraints. The change in the nature of delegation of monetary policy (tying the hands of the principal) was a means of dealing with credibility constraints. The paper goes on investigating whether, and if so to what extent, the European Parliament (EP) is fit to function as a principal of the ECB as a means of dealing with political constraints. Thus, the paper analyses the European Parliament’s increased involvement in overseeing the Central Bank’s activities, aiming at understanding whether and how that new and special role (an informal institution of dialogue) could affect the trade-off between efficiency and legitimacy in the conduct of monetary policy in the eurozone.
|Date of creation:||Mar 2006|
|Contact details of provider:|| Postal: Campus Universitario de Santiago, 3810-193 Aveiro|
Phone: +351 234 370 361
Fax: +351 234 370 215
Web page: http://www.ua.pt/degeit/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Giavazzi, Francesco & Pagano, Marco, 1986.
"The Advantages of Tying One's Hands: EMS Discipline and Central Bank Credibility,"
CEPR Discussion Papers
135, C.E.P.R. Discussion Papers.
- Giavazzi, Francesco & Pagano, Marco, 1988. "The advantage of tying one's hands : EMS discipline and Central Bank credibility," European Economic Review, Elsevier, vol. 32(5), pages 1055-1075, June.
- Francesco Giavazzi & Marco Pagano, 1991. "The Advantage of Tying One's Hands: EMS Discipline and Central Bank Credibility," NBER Chapters, in: International Volatility and Economic Growth: The First Ten Years of The International Seminar on Macroeconomics, pages 303-330 National Bureau of Economic Research, Inc.
- Bovens, Mark, 2006. "Analysing and Assessing Public Accountability. A Conceptual Framework," European Governance Papers (EUROGOV) 1, CONNEX and EUROGOV networks.
- Francisco Torres, 2003. "How efficient is Joint Decision-Making in the EU? Environmental Policies and the Co-Decision Procedure," Working Papers de Economia (Economics Working Papers) 05, Departamento de Economia, Gestão e Engenharia Industrial, Universidade de Aveiro.
When requesting a correction, please mention this item's handle: RePEc:ave:wpaper:362006. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marta Ferreira Dias)
If references are entirely missing, you can add them using this form.