Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/324923 
Year of Publication: 
2022
Citation: 
[Journal:] Journal of Contextual Economics – Schmollers Jahrbuch [ISSN:] 2568-762X [Volume:] 142 [Issue:] 3 [Year:] 2022 [Pages:] 231-246
Publisher: 
Duncker & Humblot, Berlin
Abstract: 
Among LawMacro scholars, there is a growing interest in the incorporation of distributional goals into economic institutions and policies, especially central banks. We argue that this approach threatens to undermine the rule of law in monetary policy. This is troubling because the rule of law is necessary for maintaining monetary generality and predictability. Recent macroeconomic failures, such as the Financial Crisis and inflation following the Covid-19 pandemic, highlight the economic consequences of a lawless central bank. Unconstrained and discretionary central banking are only weakly democratically accountable, which raises legitimacy concerns with their pursuit of broader social agendas without explicit statutory authorization. We make the case for strengthening the rule of law to promote monetary generality and predictability and to better ensure democratic accountability.
Subjects: 
Aggregation
Transactional Structure
Materialism and Idealism in Eco- nomics
Systems Theory and Maffeo Pantaleoni (1911)
Methodology of Scientific Re- search ProgramsFederal Reserve
Inflation
LawMacro
LawMicro
Monetary Policy
Monetary Rules
Rules vs. Discretion
Rule of Law
JEL: 
E58
E6
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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