Stefan Gerlach's picture
Affiliation: 
BSI Bank
Credentials: 
Chief Economist

Voting history

The Future of Central Bank Independence

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Question 2: Do you agree that the traditional argument that less central bank independence leads to higher inflation will (still) be relevant over the next 48 months in Western economies?

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Answer:
Disagree
Confidence level:
Confident
Comment:
The lessons from the high-inflation period of the 1970s have been learned and governments now know that excessive meddling in monetary policy can lead to very poor and politically costly economic outcomes. That said, they may be less clear about what constitutes "meddling", as is suggested by the UK debate about the Bank of England and Brexit.

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Question 1: Do you agree that central bank independence in the Eurozone and the UK will decline over the next 48 months?

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Answer:
Neither agree nor disagree
Confidence level:
Confident
Comment:
The independence of monetary policy of the central banks in the EU is part of the Lisbon Treaty. It is to me unthinkable that the independence of the ECB will be changed. By contrast, it is quite possible that the Bank of England's independence will be reduced. For instance, if Brexit, when it happens, were to have severely negative economic effects on the economy, the government might want to have control of the levers of monetary policy.

German Council of Economic Experts' view of ECB policy

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Question 2: Do you agree that the ECB's monetary policy masks structural problems of member states?

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Answer:
Disagree
Confidence level:
Confident

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Question 1: Do you agree that exceptionally loose monetary policy by the European Central Bank is no longer appropriate?

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Answer:
Disagree
Confidence level:
Very confident

German current account surpluses

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Question 2: Do you agree that the German government should increase public spending given its persistently large current account surplus and given that it is part of the Eurozone?

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Answer:
Agree
Confidence level:
Confident
Comment:
More public spending on specific public infrastructure projects that pass a careful cost-benefit analysis and contributes to economic growth would be desirable. If very large German surpluses -- which reflect a saving-investment imbalance and not competitiveness -- were continue indefinitely, they could indeed become a threat to the euro area.

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