ABSTRACT
In this chapter, we address the single most important priority of central banks under the NMC, namely price stability. After presenting the concept itself, we investigate why monetary policy – rather than fiscal policy – has become the favoured policy option in the contemporary period. Then, we examine the oft-quoted filiation between the NMC and Wicksellian economics. We challenge the view that so-called neo-Wicksellianism is faithful to Wicksell’s original ideas on monetary policy. Finally, we examine the ideological underpinnings of the NMC.
