Home | Databases | WorldLII | Search | Feedback Edited Legal Collections Data

Tucker, Paul --- "The lender of last resort: regimes for stability and legitimacy" [2018] ELECD 339; in Conti-Brown, Peter; Lastra, M. Rosa (eds), "Research Handbook on Central Banking" (Edward Elgar Publishing, 2018) 535

Book Title: Research Handbook on Central Banking

Editor(s): Conti-Brown, Peter; Lastra, M. Rosa

Publisher: Edward Elgar Publishing

ISBN: 9781784719210

Section: Chapter 26

Section Title: The lender of last resort: regimes for stability and legitimacy

Author(s): Tucker, Paul

Number of pages: 18

Abstract/Description:

In the aftermath of the financial crisis financial stability considerations have become more prominent in central banks’ policies and require substantial discretion in their implementation. We argue that transparency can serve as an instrument for central banks to balance the conflicting interests of different stakeholders and manage market participants’ expectations, explain their strategy and report on its implementation progress and receive comments and feedback by stakeholders. In view of the increasingly contested concept of central banks’ independence, we show that increasing and institutionalizing ex ante and ex post transparency on policy decisions and their implementation strengthen central banks’ accountability as a key ingredient and prerequisite for their independence. Finally, we hold that central banks’ new responsibilities for financial stability call for the development of a more comprehensive and inclusive approach given their strong impact on private actors and their linkages with other policy fields and governmental agencies.