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January 23, 2022
8/10
Controlling Credit is an excellent, scholarly study of the history and economics of the central bank of France (BdF) in the post-war period, with an emphasis on its use of credit controls. Credit controls are a form of central bank policy that have been phased out in many countries since the 70s, with focus now being on controlling monetary and financial conditions via interest rate policy. Conventional wisdom often treats the post-war Bretton Woods period as one where monetary policy was passive and financial repression was endemic. Through careful study, Monnet compellingly challenges this view showing that active use of quantitative credit policies were macroeconomically important and helped to manage financial allocation contra stories of financial repression.
While the entire book is a historical work, the first half focuses on legal, institutional, and cultural history of the BdF and the second half focuses more on the economic & financial dimensions of the period and credit policies. A student with broad interests will find interesting material cover to cover, but economics students may find the second half more to their tastes.
All together, Monnet's book is an incredibly rich study providing much food for thought. Chapters 4 and 6 in particular present a clear explanation and evaluation of group of policies whose byzantine design likely scares away less ambitious scholars. The work done to synthesize and assess these in a digestible way is impressive in and of itsself. That the empirical work suggests they were such powerful tools then adds to its great value and leaves lessons about the potential benefits and limitations of similar policies in contemporary times, which have seen some revival under the branding of "macroprudential" policy.
Controlling Credit is an excellent, scholarly study of the history and economics of the central bank of France (BdF) in the post-war period, with an emphasis on its use of credit controls. Credit controls are a form of central bank policy that have been phased out in many countries since the 70s, with focus now being on controlling monetary and financial conditions via interest rate policy. Conventional wisdom often treats the post-war Bretton Woods period as one where monetary policy was passive and financial repression was endemic. Through careful study, Monnet compellingly challenges this view showing that active use of quantitative credit policies were macroeconomically important and helped to manage financial allocation contra stories of financial repression.
While the entire book is a historical work, the first half focuses on legal, institutional, and cultural history of the BdF and the second half focuses more on the economic & financial dimensions of the period and credit policies. A student with broad interests will find interesting material cover to cover, but economics students may find the second half more to their tastes.
All together, Monnet's book is an incredibly rich study providing much food for thought. Chapters 4 and 6 in particular present a clear explanation and evaluation of group of policies whose byzantine design likely scares away less ambitious scholars. The work done to synthesize and assess these in a digestible way is impressive in and of itsself. That the empirical work suggests they were such powerful tools then adds to its great value and leaves lessons about the potential benefits and limitations of similar policies in contemporary times, which have seen some revival under the branding of "macroprudential" policy.
Displaying 1 of 1 review