On the Fundamental Principles of Economic Policy

The article contributes to the debate focused on the institutional principles of policies conducted by the fiscal as well as the monetary authorities. The author offers a brief review of the main relations between the aims of macroeconomic policy and the instruments that enable to fulfill the former. At the same time specific determinants of the aim-oriented decisions by the central bank or the government are reviewed. Last but not least in the analysis is the dilemma of policy mix coordination and the formal/informal status of the government as well as of the central bank is extensively discussed.