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14 - Outlines of a Reform Programme for the UK’s Monetary Regime

from V - Lessons for Central Bank Independence

Published online by Cambridge University Press:  14 November 2024

By
Paul Tucker
Edited by
Sean Holly ,
Michael McMahon ,
Stephen Millard  and
Anna Watson
Sean Holly
Affiliation:
University of Cambridge
Michael McMahon
Affiliation:
University of Oxford
Stephen Millard
Affiliation:
National Institute of Economic and Social Research
Anna Watson
Affiliation:
University of Cambridge
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Summary

This chapter sets out a dozen propositions aimed at underpinning and, perhaps, revitalising Britain’s Monetary Policy Committee and the regime entrusted to it. It has not addressed the many reform proposals - such as merging the MPC and Financial Policy Committee, or having regional representatives on the MPC. Nor has it addressed the incentives of the regime’s parliamentary and other overseers.

Keywords

Nominal anchorCentral bank credibilitycentral bank independenceunelected powerfinancial stability
Type
Chapter
Information
Reflections on Monetary Policy after 25 Years of the MPC , pp. 169 - 186
Publisher: Cambridge University Press
Print publication year: 2024

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References

Aikman, David (2021), ‘How has the Financial Policy Committee’s objective changed since its inception?’ Macroprudential Matters, 9 December.Google Scholar
Bank of England (2021), ‘Evaluation of the Bank of England’s approach to quantitative easing’. Independent Evaluation Office Report.Google Scholar
Campbell, Jeffrey R., Evans, Charlie L., Fisher, Jonas D. M., and Justiniano, Alejandro (2012), ‘Macroeconomic effects of Federal Reserve forward guidance’, in Romer David and Justin Wolfers (eds.) Brookings Papers on Economic Activity, Spring. Brooking Institute Press, 1–80.Google Scholar
Powell, Jerome (2023), Sveriges Riksbank Panel on ‘Central bank independence and the mandate – evolving views’. Federal Reserve Board, 10 January.Google Scholar
Steven, Cecchetti and Tucker, Paul (2021), ‘Understanding how central banks use their balance sheets: A critical categorisation’. 1 June VoxEU.org. Centre for Economic Policy Research.Google Scholar
Tucker, Paul (2002), ‘Quantitative easing, monetary policy implementation, and the public finances’. Institute for Fiscal Studies Green Budget 2002, chapter 7.Google Scholar
Tucker, Paul (2018), Unelected Power: The Quest for Legitimacy in Central Banking and the Regulatory State. Princeton University Press.Google Scholar
Tucker, Paul (2020), ‘Solvency as a fundamental constraint on LOLR policy for independent central banks: Principles, history, law’, Journal of Financial Crises. 2(2), 1–33.Google Scholar
Tucker, Paul (2021), ‘The fed appointments process should be overhauled’, Financial Times, 23 November.Google Scholar
Wessel, David (2018), ‘Alternatives to the Fed’s 2 percent inflation target’. Brookings, 7 June, pp. 13, 17.Google Scholar

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