”The monetary policy toolkit needs to be modernised”
Lennart Erixon, professor emeritus of economics at Stockholm University, and Samuel Färdow Kazen propose a comprehensive reform to better coordinate fiscal and monetary policy.
Photo: Mostphotos/Kenneth Kullman
The monetary policy toolkit needs to be modernised. It is inefficient to rely on private banks as intermediaries to stabilise prices.
In an opinion piece in Dagens Industri, Lennart Erixon and Samuel Färdow Kazen suggest that the Riksbank introduce a digital currency, the e-krona, to allow monetary policy to be implemented directly towards citizens, businesses, and the public sector. This would make the Riksbank less dependent on private banks, while at the same time making monetary policy more efficient and reducing the risk of financial crises.
”The monetary policy toolkit needs to be modernised. It is inefficient to rely on private banks as intermediaries to stabilise prices,” Erixon and Färdow Kazen write in the article. They further argue that the Riksbank still could maintain its independence and continue to focus on combating inflation.
