Baltic Business Research

Sammanfattning:                                                                                                                                                                                                                                                        Alan Blinder – professor vid Princeton och f d vice ordförande i Fed – undersöker I denna utmärkta artikel, i vad man andra centralbanksuppgifter än de traditionella såsom räntesättningen med fördel kan bli kopplade till landets penningpolitiska institution, centralbanken (ett ämne som för närvarande tas upp i många akademiska konferenser och centralbanksseminarier). Han ser dylika möjligheter, till exempel vid uppkomsten av potentiella finansiella bubblor – men inte avseende aktiebubblor utan i samband med s k kreditbubblor. Blinder förordar också att icke nödvändiga centralbanksuppgifter ”utlokaliseras” till andra institutioner.

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Alan Blinder was a prominent professor at Princeton before he became the vice chairman of the Federal Reserve Board. After having left the Fed, he returned to academia and Princeton. Blinder is an influential monetary policy researcher. His work should be read by economists and others who want to discuss more than the next policy step by the central bank.

In his article “How Central Should the Central Bank Be?”, Blinder leans heavily on the economics of scope. He concludes that “the central bank should monitor and regulate systemic risk because preserving financial stability is (a) closely aligned with the standard objectives of monetary policy and (b) likely to require lender of last resort powers…” I think that Blinder is right about the first point, about monitoring systemic risk. Regulating systemic risks, however, should not necessarily belong to central bank commitments. There are both pros and cons.

Blinder pays special attention to the question whether “asset-price bubbles should be an integrated part of monetary policy. Or should the Fed eschew second-guessing market valuations content itself with “mopping up” after bubbles burst (what Blinder calls the Greenspan/Bernanke approach)? Blinder offers a reasonable distinction between credit-fueled bubbles and equity-type bubbles. He argues that the “mop approach” still should be applicable to equity bubbles not fueled by credits. However, the central bank should “try to limit credit-based bubbles”. I do share Blinders opinion on this issue by 100 percent. More central bankers begin to share this view as well.

I feel happy about these pragmatic changes in the real and academic world – an approach that I have been pleading for during a whole decade. Only a few years ago, the Swedish financial newspaper Dagens Industri interviewed a number of economists about their view on monetary policy and asset prices. If I remember correctly, I was the only one who supported this nexus.

Our modern global economy calls for a much broader and better macrofinancial analys and integration of central banks’ objectives and commitments. I am waiting for the next interesting publication of Alan Blinder.