The Politicization of the European Central Bank: What Is It, and How to Study It?

Abstract

The politicization of the European Central Bank (ECB) is a recurrent theme in debates on the EU after the crisis, yet it is one that still suffers from a considerable degree of vagueness. This is unfortunate as it hinders the development of useful discussions on the place and legitimacy of the ECB within Europe's institutional order. To tackle this problem, this article presents a systematic analysis of the concept of ECB politicization and an agenda for future research on this phenomenon. After reviewing existing uses of the term in the form of three dichotomiespoliticization versus independence, impartiality, and conventionthe article proposes an alternative, preference-based definition of politicization as a deviation from technocratic policy-making in the ECB. Building on this definition, the article then indicates three avenues for the empirical study of politicization centred, respectively, on elite interviews and surveys, the analysis of central bankers' networks and the study of ECB language.

The power of expertise: gauging technocracy in EMU reform negotiations

“…One of the foremost institutions of the Eurozone, the ECB is formally set up as an expert/technical actor par excellence: it is an unelected, non-majoritarian body granted a high degree of independence from its political principals (the member states), and tasked with conducting the Eurozone's monetary policy guided by macroeconomic reasoning and within a mandate of price stability. In recent years, the ECB has played an important role in steering the Eurozone through its crisis and its economic aftermath, among other things by introducing a number of unconventional measures, which have led many observers to speak of a 'politicization' of the Bank (on this debate see e.g., Högenauer & Howarth, 2016;Jones & Matthijs, 2019;Scicluna, 2014;Tortola, 2020b). The excessive policy-making autonomy on the part of the ECB, to which these authors point by using the term politicization, essentially overlaps with the notion of technocracy as defined in this article.…”

A “More Political” Commission? Reassessing EC Politicization through Language

“…This type of information is particularly precious in the case of the EC, whose overall setup remains, as mentioned above, a mixture technical and political aspects despite all its recent transformations. In this ambiguous context, the analysis of EC politicization hinges to a significant degree on an assessment of the preferences behind the actions of the Commission, and ultimately on the latter's self‐perception as an institution (Tortola, 2020b). In this reading, language is then to be seen as a dimension of politicization that is at least as important as the remaining three – institutional, policy, and individual – and contributes with them to the overall measurement of EC politicization.…”

Doing Away with the Sovereign: Neoliberalism and the Promotion of Market Discipline in European Economic Governance

“…Arguably then, the flipside of liberal economic governance having to resort to increasingly authoritarian forms of rule is the simultaneous loss of its depoliticised nature and appearance (Schmidt 2019;Tortola 2019). The current push by Europe's ordoliberal and market-liberal policymakers for more market discipline can be viewed as an attempt to counter these tendencies.…”

“…Moreover, the ECB repeatedly took advantage of its control over the government bond market to either directly or indirectly pressure governments into greater austerity and structural reforms (Bastasin 2015;Woodruff 2016). Such a blatant use of the market as a policy tool to subject governments to the will of the central bank rendered the ECB's power over the bloc increasingly apparent-and politicised (Högenauer 2019;Tortola 2019).…”