Credible interventionism: economic ideas of government and macroeconomic policy in the Great Recession

Ronen Mandelkern and Tami Oren

New Political Economy, 2023, vol. 28, issue 1, 76-90

Abstract: The macroeconomic policies of advanced economies during the Great Recession were characterised by a curious mixture of unconventional market interventions executed through depoliticised governance structures. We explain this phenomenon by developing a theoretical framework that focuses on the ideational and institutional influence of government-related economic ideas by combining insights of constructivist institutionalism and historical institutionalism. Specifically, we argue that the dominant government-related idea of ‘policy credibility’ – the need to convince markets of government commitment to refrain from ‘politicised’ interventions – was crucial for the adoption of depoliticised macroeconomic interventionism. The ideational dominance of ‘policy credibility’ and its pre-crisis institutionalisation enabled significant policy interventions as long as depoliticised decision-making was maintained and consolidated. We demonstrate this argument through a comparative in-depth analysis of monetary and fiscal policy in two very different cases among advanced economies – the UK and Israel.

Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/13563467.2022.2067839 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:cnpexx:v:28:y:2023:i:1:p:76-90

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/cnpe20

DOI: 10.1080/13563467.2022.2067839

Access Statistics for this article

New Political Economy is currently edited by Professor Colin Hay

More articles in New Political Economy from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().