Reforming the European Central Bank

  • Christophe BlotEmail author
  • Paul Hubert
  • Fabien Labondance


Since the subprime and sovereign debt crises, the European Central Bank (ECB) has enlarged its prerogatives and objectives. The ECB has taken over the objective of financial stability, has expanded the range of its instruments, and is now in charge of the supervision of significant banks within the Banking Union. These changes took place without a treaty change. The ECB has behaved pragmatically to deal with the crisis and has adapted its operational framework to fix the many dimensions of the crisis. It thus had to take decisions which had not been envisaged during the drafting of the Treaty and whose legality was contested. Those decisions have also highlighted the pitfalls of European governance, calling for reforms. However, those reforms should not only concern fiscal and institutional issues. There is also room to improve the governance of the ECB and of monetary policy. Finally, since 1999, the euro area has grown from 11 to 19 members, which raises the question of the decision-making process. This contribution looks back at these elements of the monetary governance of the euro area and suggests ways of reform that would improve the implementation of monetary policy. We talk about expanding its mandate in terms of financial stability, the need to clarify the border between monetary policy and public finances and the reform of its decision-making process.


Financial stability Unconventional monetary policy Governing Council Banking Union 


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Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Christophe Blot
    • 1
    • 2
    Email author
  • Paul Hubert
    • 1
  • Fabien Labondance
    • 3
  1. 1.OFCE, Sciences PoParisFrance
  2. 2.Université Paris NanterreNanterreFrance
  3. 3.CRESE Université de BesançonBesançonFrance

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