Europe and Its Central Banks: Lessons from History

2026-07-22

"Will central bank independence continue? In economic literature, there is a large consensus that the optimal statute for a central bank should be founded on the principles of independence and price stability. Over the past 30 years, most central banks across the advanced economies have been given the ability to conduct monetary policy independently from interference by fiscal and political authorities. In the post financial crisis era, however, central banks in many countries have been entrusted with the formulation of measures of ‘unconventional’ monetary policy going beyond their traditional mandates. Historical evidence reminds us that for many decades and especially after crises central banks have been heavily involved in industrial finance and the holding of government debt, but in ways that are often ignored. This was at least the case in France and Italy. The aim of EUROCBH (Europe and Its Central Banks: Lessons from History) is to place the question of the independence of the central bank in a historical perspective, shedding light on the evolution of the Bank of France and the Bank of Italy from the late 19th century to WWII. The activity of EUROCBH will be organized around four main research questions: 1) What was the role of the the central bank in fostering long-term investment and absorbing economic (and financial) shock in Italy and France? I will look at long term and targeted lending, and massive purchase of government bonds as ""unconventional” measure of the central bank. This is the main question to which the others are all connected. 2) What were the similarities and the differences between the central banking experimentations of these two countries? 3) What we can learn from the comparison? Overall the project will lead to a better knowledge of central banking in the past, which is also expected to help understanding the re-opened debate surrounding the legitimacy, and the precise scope of central bank independence after the crisis."

France

2026-02-15