The European Central Bank and the European Macroeconomic Constitution: From Ensuring Stability to Fighting Crises

The book explores the establishment of the European Central Bank, its role in ensuring stability and prosperity for the euro area, and the challenges it faces in addressing recurring crises. It highlights the ECB's push for boundaries in monetary policy and its impact on accountability mechanisms and democratic legitimacy. The book emphasizes the need for a balanced approach to new objectives, such as financial stability, economic adjustment, and environmental sustainability, to avoid potential ruptures and risks to monetary policy.

Format: Hardback
Length: 280 pages
Publication date: 22 September 2022
Publisher: Cambridge University Press

The book delves into the intricate realm of money, central banking, and constitutions, offering a comprehensive exploration of the European Central Bank's (ECB) establishment and its role in ensuring stability and prosperity for the euro area. It explains how the ECB was guided and controlled by a coherent European Macroeconomic Constitution, aiming to foster a robust economic environment. However, despite its best efforts, this model has faced challenges during recurring crises, prompting the ECB to assume the role of the euro area's fire brigade. Consequently, the ECB has pushed the boundaries of monetary policy, raising concerns about accountability mechanisms and the democratic legitimacy of the European Monetary Union (EMU).

The book sheds light on this complex economic-constitutional setting, providing insights into the future challenges and opportunities. It highlights the imbalance between the ECB's various new operations and its singular focus on price stability, emphasizing the difficulty in rectifying this imbalance. Introducing new objectives such as financial stability, economic adjustment, and environmental sustainability can create fundamental tensions between the ECB's formal role and its actions, potentially leading to significant disruptions. Moreover, these new objectives significantly burden monetary policy, posing substantial risks for the future.

The book serves as a valuable resource for policymakers, economists, and scholars interested in understanding the dynamics of central banking, monetary policy, and the broader economic-constitutional landscape. It offers a thought-provoking analysis and raises important questions about the future direction of the ECB and the EMU. By examining the past and present challenges, the book provides valuable insights into the potential risks and opportunities that lie ahead.

Weight: 666g
Dimension: 159 x 236 x 29 (mm)
ISBN-13: 9781108488747