10/2017 What will monetary policy look like after the crisis? http://www.ecb.europa.eu/pub/economic-research/resbull/2017/html/ecb.rb171018.en.html 1/5 RESEARCH BULLETIN NO. 39 What will monetary policy look like after the crisis? By Alan Blinder, Michael Ehrmann, Jakob de Haan and David-Jan Jansen [1] The conduct of monetary policy has changed dramatically since the financial crisis in several dimensions. This article asks whether these changes will be temporary or permanent based on surveys of central bank heads and academic economists. Ten years after the financial crisis, one key question is whether the various changes in monetary policy that have been introduced since then will turn out to be temporary, or whether we have witnessed a permanent change in the way monetary policy is and will be conducted. To shed light on this question, we conducted surveys of central bank heads and academic economists across four themes: central bank mandates, monetary policy tools, central bank communication and the relationship between central banks and governments [2] . The results are reported in Blinder et al. (2017) and a summary is provided in this article. Central bank mandates Several central banks have seen their mandates expanded since the global financial crisis. The ECB, for instance, has taken on a macroprudential as well as a microprudential role. The survey results show that a majority of respondents (62 percent of central bankers and 54 percent of academics) have reconsidered what would be the most appropriate mandate of their country´s central bank. In particular, in a move away from the predominant pre-crisis view that central banks should mainly be concerned with price stability, many respondents to our surveys mention that financial stability considerations should also be part of the central bank mandate. Monetary policy instruments Confronted with a massive financial crisis and its repercussions, as well as stubbornly low inflation rates, central banks resorted to a large number of unconventional monetary policies. The surveys cover respondents’ opinions about the most important ones: policy rates that are near zero or even negative, asset purchase programmes using different asset classes, macroprudential measures and forward guidance. Chart 1 summarises the responses. Central bank heads are typically more cautious in their responses, often finding it too early to pass judgement on a particular tool. A more detailed analysis reveals, however, that those central bank heads who have previously deployed a particular tool view this tool much more favourably. Accordingly, they are more likely to think that this tool should remain in the central bank’s toolkit, whether in current or modified form. In contrast, academic economists tend to have made up their minds and to favour keeping most of the tools. The relatively more far-reaching tools (negative rates vs. rates near zero, and quantitative easing using other assets vs. quantitative easing using government debt) are seen more critically by both groups, with a substantially larger percentage of academics suggesting that they should be discontinued. The area in which both respondent groups agree most is macroprudential policy, with large majorities calling for its continued usage.    