What should be the role of the ECB in tackling the socio-ecological challenges related to planetary boundaries, such as climate change and loss of biodiversity? A clear answer to this question is still lacking, in spite of the strategy review of 2021. Regretfully, this review has not received...

This paper advances three fundamental propositions regarding money: (1) As R. W. Clower (1965) famously put it, money buys goods and goods buy money, but goods do not buy goods. (2) Money is always debt; it cannot be a commodity from the first proposition because, if it were, that would mean...

This paper uses the variability of money market rates to compare the conduct of the central bank's key market operation as a fixed-rate tender (FRT) or a variable-rate tender (VRT). Nowadays, leading central banks generally use FRTs or other approaches (e.g. target rates) which yield step...

The capital structure of firms is known to be different not only due to firm characteristics but also to the sources of capital. Therefore, there is a need to understand the supply side effects on a firm´s capital structure. A small firm´s choice of financing sources may be limited by the...

Too Big to Fail? The Newfoundland Bank Crash of 1894 In the Newfoundland Bank Crash of 1894, the commercial banks in a duopolistic loan market both went under simultaneously. The banking system was "free", as central bank, deposit insurance, and lender of last resort were all absent. The...

Do emerging markets need to sacrifice economic sovereignty in order to borrow more cheaply on the international capital markets? To explore this, we exploit a natural experiment following the Treaty of Berlin in 1878 when four Balkan states - Bulgaria, Greece, Romania, and Serbia - received full...

It is commonplace to speak of central bank "independence" as if it were both a reality and a necessity. While the Federal Reserve is subject to the "dual mandate", it has substantial discretion in its interpretation of the vague call for high employment and low inflation. Most important, the...

Supervisors sometimes have to manage both the micro- and macro- prudential dimensions of bank stability. These may either conflict or complement each other. We analyze prudential supervision by the Central Bank of Russia (CBR). We find evidence of micro-prudential concerns, measured as the...

This study investigate how debt restructurings have evolved over the decades. Debtors and creditors have a long history of engaging an outsider a third party”, such as the IMF to organise and facilitate debt restructurings. As we show, the importance of these third parties” has grown over...

In the last two decades, there has been a global sea change in the theory and practice of central banking. The currently dominant ‘best practice’ approach to central banking consists of the following: (1) central bank independence (2) a focus on inflation fighting (including adopting formal...