Writing Central Bank and Monetary History

A nice speech from Øyvind Eithrheim of Norges Bank. The speech is based on a workshop to discuss the Norges Bank’s Bicentenary Project. NB has sponsored a grand  project to understand monetary history. The project is aimed at celebrating the 200 years of the founding of the bank to be completed in 2016.

He says there will be 3 volumes from this project each with different purpose:

We want to give birth to three high-quality books: The History of Norges Bank 1816–2016; The Monetary History of Norway 1816–2016; and last but not least a book on central banking viewed from an international historical perspective,What is a useful Central Bank? Evolution over two centuries, in the form of a conference volume. All three books will be focused on the same substance: central banking over the past two centuries, but written from different angles.

  • The first book is to be written by economic historians in their tradition. 
  • The second book is being written by economists focusing on the economic analysis of the monetary history of Norway, and 
  • finally we have the book that attempts to answer the perennial question of what is the role of the central bank today and how that role has evolved over the past two centuries. Norway will only appear in the latter book if we have contributed something special to the evolution.

Interesting classification between first and second volumes – economic historians vs economic analysis of mon history of Norway..First one just looks at the history of how thing developed etc. The second one analyses the monetary history with economic analysis..Both should be a great read. Some papers are already out on the project. I even covered one of them in my blog.

In addition to the end product, the three books, it was stated at the very beginning of the project that the road towards the end products would also be an end in itself. There are two aspects of this, competence and communication. Firstly, the first phase of the project has produced numerous research publications, in books and journals, ten master theses at Norwegian universities, and two PhD projects which are in progress. Hence, the project has already increased our insights in central banking and monetary history. Secondly, inspired by the Swiss 100-year anniversary project, which we learned about at the 2008 workshop here in Geneva, we have recently published the first version of Norges Bank’s historical time lines on the internet. We will continue to develop this application, it will be translated into English, and Norges Bank’s Bicentenary Project will continue to document high-quality historical data and sources, and supply more long time series and broader data sets.

There are some more insights on c-banking. He says CBs historically have struggled to main price stability in normal times and financial stability in crisis times:

From a historical perspective, the dominating concern for central banks has typically varied between normal times (price stability) and extraordinary times (financial stability). What seems to draw the most interest today, in light of the recent financial crisis, is indeed this shifting balance between price stability and financial stability. The future role of central banks is again on the top of the agenda. Are we actually entering a new epoch? Charles Goodhart identified three epochs during which the interpretation of central banks’ role was stable; the Victorian era (the 1840s to 1914); the decades of government control (the 1930s to 1960s); and the triumph of the markets (the 1980s to 2007). Following the financial crisis we now face the challenge of finding appropriate ways to implement macroprudential policy and supervision, and jointly, to find the right balance between the responsibilities of central banks, financial supervisory authorities and ministries of finance.

Interesting stuff…

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