Is there a self-enforcing monetary constitution?

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23 Scopus citations


A self-enforcing monetary constitution has rules that agents acting within the system will uphold even in the presence of deviations from ideal knowledge and complete benevolence. It thus does not require external enforcement. What would such a constitution look like? I show that two regimes-a version of nominal gross domestic product targeting that relies on market implementation of monetary policy, and free banking-meet these requirements for self-enforcing monetary constitutions. The analysis draws insights from political economy, and from constitutional political economy in particular.

Original languageEnglish
Pages (from-to)280-300
Number of pages21
JournalConstitutional Political Economy
Issue number3
StatePublished - Sep 2014


  • Central banking
  • Constitutional political economy
  • Free banking
  • Monetary constitution
  • NGDP targeting
  • Robust political economy


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