For example, the term of office for members of the Executive Board of the ECB is limited to eight years, and is non-renewable. Together, the treaty-enshrined foundations of the Monetary Union combine the ECB’s independence with clear, democratic legitimation. Price stability is in the acknowledged, very best long-term interests of the people. Stable prices benefit society as a whole, rather than serving individual interests.
Price stability guarantees the purchasing power of income and the value of savings. It prevents arbitrary redistribution and fosters employment and growth. Only when prices are stable is the price mechanism – the key tool for managing supply and demand in a market economy – transparent and efficient. These findings also have a strong tradition within German economic science.