CENTRAL BANK INDEPENDENCE - A POLITICAL-ECONOMY APPROACH

The article uses a political economy approach to examine critically the conventional arguments for central bank independence and to make the terms of debate more precise. It assesses the advisability and feasibility of greater autonomy in relation to the constellations of political forces in specific societies and concludes by suggesting how, in the context of developing societies, an accommodation of interests might be reached to support a more autonomous but not fully independent central bank.