КЕЙНСІАНСЬКА КРИТИКА НЕЗАЛЕЖНОСТІ ЦЕНТРАЛЬНИХ БАНКІВ

Abstract

The article is aimed at analyzing the arguments of Keynesianism representatives against the modern paradigm of central banks independence. According to the result of the study, the modern paradigm of independence of central banks is the result of the adoption of a framework for monetary policy in the form of inflation targeting and represents a certain set of indicators of legal and actual protection against political interference in monetary policy. The Keynesian approach to monetary policy is based on an understanding of the principles of the money market, where there is only a natural interest rate and the role of the central bank is usually offset by this. The natural interest rate is defined as the equilibrium rate of the economy with flexible prices and reflects the potential in the dichotomy of “consumption-investment”. In turn, the central bank's rate, which is usually not the same as the natural one, determines the monetary institution's policy of limiting or stimulating economic growth through control of inflation. The central bank is given the role of an auxiliary tool for ensuring economic equilibrium along with fiscal policy or a discretionary body, which adapts to short-term decisions aimed at reducing unemployment. According to Keynesianism in the long term, there is a tendency to neutrality of money and the central bank can only influence demand in the short term. From this position, the implementation of an activist independent monetary policy negatively affects the economic development due to the uneven impact of interest rates on various sectors of the economy; the inability of central banks to “fine-tune” the economy and the inefficiency of interest rates as a tool of monetary policy by incorporating it into the expectations of economic entities. Based on this, the author determined that the role of central banks, according to Keynesian tradition, varies from an auxiliary tool for ensuring economic growth (Phillips curve) to their compliance with systematic, objective rules for limited purposes (price stability and proper functioning of the financial system).