Read more
Central Banking in Turbulent Times examines fundamental questions about the central banking system, asking whether the model of an independent central bank devoted to price stability is the final resting point of a complex development that started centuries ago. It dissects the hypothesis that the Great Recession has prompted a reassessment of that model; a renewed emphasis on financial stability has emerged, possibly vying for first rank in the hierarchy of objectives of central banks. This raises the risk of dilemmas, since the Great Recession brought into question implicit assumptions that the pursuit of price stability would also lead to financial stability. In addition, the border between monetary and fiscal policy was blurred both in the U.S. and in Europe.
Central Banking in Turbulent Times asks whether the model prevailing before the Great Recession has been irrevocably altered. Are we entering, as Charles Goodhart has hypothesized, into the fourth epoch of central banking? Are changes to central banks part of a move away from the global liberal order that seemed to have prevailed at the turn of the century?
Central Banking in Turbulent Times seeks to answer these questions.
About the author
Francesco Papadia has nearly forty years of central banking experience. Beginning with the founding of the European Central Bank (ECB) in 1998, he served as the director general for market operations until 2012. Prior to that, he held various positions at the Banca d'Italia and was economic advisor at the EU Commission. Currently he is chairman of the Board of the Prime Collateralised Securities, chair of the selection panel of the Hellenic Financial Stability Fund, senior resident fellow at the Bruegel Institute, and a university lecturer.
