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We analyse the trajectory of independence in formation European Central Bank (ECB), conceptualized as a boundary organization that, by delineating economy, contributes to supranational state effect. Success effort, however, requires ECB constantly assert separate and special status, despite its embeddedness multiple fields. Focusing on Monetary Institute, ECB’s predecessor, we trace how histori...

Why do firms and banks hold foreign currency denominated liabilities? In this paper, we argue that foreign currency debt, by altering the effect of a devaluation on output, has a disciplining effect when the Central Bank’s objectives differ from the social optimum. However, under imperfect information, bad priors about the Central Bank induce excess dollarization of liabilities, which in turn l...

The European Central Bank’s (ECB) role as a political actor during the euro crisis raised concerns about its independence and insufficient accountability. Against this backdrop, article investigates how why ECB reacted to demands for more accountability following crisis. To end, we revisit independence-accountability nexus, adding three qualifications conventional wisdom that do not go together...