The Functions of the Central Bank in Today’s Economy

Abstract

The choice of this subject and its treatment here reflect the need to ascertain how far the institutional structure allows the central bank to perform the tasks required of it by a modern economy. This need stems not only from the seriousness of the problems facing the Italian economy but also from the tendency in all the industrial countries for the links between the economic and the institutional and between the juridical and the operational to increase and tighten. This tendency is confirmed by plentiful evidence, which is open to both analytical and value judgements, but which on this occasion needs only to be registered: first, the mere fact that institutional factors are still seen by many as constraints on the working of markets; second, the oft-repeated wish for more complementarity between the ‘market’ and ‘planning’; and third, the greater efforts to take an interdisciplinary view of the problems.