Central Bank Challenges in the Global Economy
Introductory Remarks: There are few institutions linked to the exercise of public power in the economic sphere that have stood the test of time for as long as central banks. Indeed their origins can be traced back to the seventeenth century when in 1668 the Swedish ‘Bank of the Estates of the Realm’ the forerunner of todays Riksbank was established by the Riksdag, at the dawn of two major armed conflicts with neighbouring Denmark. Soon thereafter, in the midst of the Nine Year War between England and France the Bank of England was established by an Act of Parliament. Other European countries such as France and the German Reich would follow suit in due course. Asserting that the role of central banks has changed in the course of their long history is hardly original. These changes can be observed both with regard to their main tasks, as well as their ownership and (corporate) institutional structure. A number of central bank systems have emerged from private corporations ((joint-) stock companies) that were initially set up with the aim to raise capital for the financing of wars thus acting as the quasi-banker of government, while at the same time undertaking commercial banking. Eventually these banks would become public corporations. ...