Show Summary Details

Page of

PRINTED FROM OXFORD HANDBOOKS ONLINE ( © Oxford University Press, 2018. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a title in Oxford Handbooks Online for personal use (for details see Privacy Policy and Legal Notice).

date: 20 May 2019

Abstract and Keywords

Central banks have a mandate—either explicit or implicit—to guard against systemic financial crises and manage them if and when they occur. Given the need to make urgent decisions in the face of rapidly evolving circumstances, the central bank in a crisis faces challenges of economic analysis, market judgment, and political legitimacy. Lacking a simple criterion such as the rate of inflation, crisis-management decisions are inevitably contested in terms of both technical success and democratic legitimacy. Focusing on the mandates and the toolkit of central banks, this chapter illustrates how shortcomings can arise in responding to macrofinancial crises and then highlights directions for improvement. A selection of case studies identifies how political economy dynamics had an impact on historic episodes, for better or worse.

Keywords: central bank mandate, economic analysis, market judgment, political legitimacy, macroprudential policies, crisis management

Access to the complete content on Oxford Handbooks Online requires a subscription or purchase. Public users are able to search the site and view the abstracts and keywords for each book and chapter without a subscription.

Please subscribe or login to access full text content.

If you have purchased a print title that contains an access token, please see the token for information about how to register your code.

For questions on access or troubleshooting, please check our FAQs, and if you can''t find the answer there, please contact us.