8 mars 2022
Quo Vadis? Monetary and Fiscal Interactions Revisited
The age-old problem of how monetary and fiscal policy should interact has resurfaced around the globe. In an era where fiscal policy was seemingly passive, and monetary policy was given pride of place to achieve business cycle stabilization, coordination problems between fiscal and monetary authorities was largely set aside.
The series of financial crises in the advanced economies in the 2000s, and the ongoing COVID-19 crisis, have combined to raise old questions in a new setting. Governments appear reluctant, at least in the short to medium-term, to follow budget constraint rules and debt sustainability criteria. Central banks continue to argue that ultra-low interest rates, together with purchases of a wide variety of financial assets, deliver the needed monetary policy accommodation necessary for the aggregate economy to heal.
In this context, it is useful to revisit the question of monetary-fiscal interactions. The relevant issues go beyond responding to various economic shocks, how monetary policy ought to be conducted, and the stance of fiscal policy when growth is sluggish and interest rates are likely to remain depressed for some time. There are also governance or institutional questions to be considered since simplistic notions of central bank independence no longer describe the environment of the past several years. Indeed, existing monetary policy strategies are also called into question. Relevant historical evidence can also be useful. Finally, there is the issue of how autonomous institutions within government communicate policies in a credible manner.
- Speakers: Kai Arvai (Research Economist, Banque de France), Claudio Borio (Head of the Monetary and Economic Department, Bank for International Settlements), Georgios Chortareas (Professor, King’s College London), Sebastian Diessner (Assistant Professor, Leiden University / Visiting fellow, London School of Economics), Paul Hubert (Research Economist, Banque de France/Science Po), Donato Masciandaro (Professor, Bocconi University), Warwick McKibbin (Australian National University), Jouchi Nakajima (Senior Economist, Bank of Japan), Jonathan Ostry (Deputy Director of the Asia and Pacific Department, International Monetary Fund), Maria Sole Pagliari (Research Economist, Banque de France), Pierre Siklos (Professor, Wilfrid Laurier University / 2021 FFJ/Banque de France fellow), Guido Traficante (Assistant Professor, Università Europea di Roma), Masazumi Wakatabe (Deputy-Governor, Bank of Japan)
- 8 March 2022 - 9.00 - 18.00 (Paris time) | 17.00 - 2.00 (Tokyo time)
- Online - In English