More explicitly, and by reference to another famous framework – the three basic policy functions that Richard Musgrave described as allocation, stabilisation, and distribution, and which aim delivering what Tommaso Padoa-Schioppa later described as efficiency, stability and equity – our policy is concerned only with macroeconomic stabilisation through the pursuit of price stability.
We do not and should not play an active role in the functions of allocation and distribution4. At the same time, our operational framework has always included elements of what Goodfriend qualifies as credit policy. The ECB manages liquidity and steers money market rates by lending to banks in temporary credit operations against a broad range of collateral. Furthermore, we have always remunerated reserves.