« Nouvelle normale » ou « nouvelle orthodoxie » ?. Éléments d’un nouveau cadre d’action pour les banques centrales

Christian Pfister and Natacha Valla

Revue économique, 2017, vol. 68, issue HS1, 41-62

Abstract: The paper contrasts two different approaches to central banking in the aftermath of the crisis.?In the first one, labelled ?new normal,? the monetary policy strategy is broadened to encompass such objectives as financial stability or full employment. Furthermore, the inflation target is raised and large scale asset purchases (LSAPs) are retained as a standard instrument for implementing monetary policy.?In the second approach, which we label ?new orthodoxy,? central banks keep the same objectives but interest rates can be brought to unprecedented negative levels, thus making LSAPs possibly unnecessary.?The role of central banks in preserving financial stability is also explicitly recognized, both by themselves and by society, making their contribution to this task more effective and transparent.?We explain why the new orthodoxy should be a superior strategy and describe its institutional preconditions and practical implementation. Classification JEL : E42, E43, E50, E52, E58.

JEL-codes: E42 E43 E50 E52 E58 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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