Article published in La Revue d’économie financière
The societal responsibility of central banks echoes the social responsibility of companies. The difference in the term reflects the fact that central banks are responsible to society as a whole and not simply to the partners with whom they have contractual relations. In this article, we seek to decipher the forces at work in the deconstruction of the myth of a central bank solely dedicated to preserving the value of money and disconnected from major societal issues and debates. We develop the idea that since the financial crisis, central banks have been re-engaging their politics in the life of the city. We illustrate this assertion through two intensely debated questions: on the one hand, the effects of monetary policy in terms of inequality and, on the other hand, the role of central banks in the ecological transition. Finally, we point out some unresolved issues regarding the social responsibility of central banks.
Using an empirical stock-flow consistent (SFC) model for the French economy, we simulate an imported inflationary shock to emulate the current inflation situation and analyze the resulting macroeconomic impacts on the French economy. Two possible responses are considered: increased wage per capita so as to preserve workers’ purchasing power, increased margins by firms in order to restore their...
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