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The limits to “whatever it takes”: Lessons from the gold standard

Ugolini, Stefano, (2016), “The limits to “whatever it takes”: Lessons from the gold standard”, Voxeu, 30 August

When Mario Draghi famously declared that the ECB was “ready to do whatever it takes to preserve the euro”, he also specified “within our mandate”. This column examines the institutional limitations to central bankers’ actions. It argues that institutional constraints are essential in determining the sustainability of monetary policies, and hence central banks’ ability to pursue their targets. The weakness of the Bank of England in the heyday of the gold standard is a case in point.

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