In the decades prior to the crisis, such radicalism came to dominate economic ideas and became a pattern of social  6  As Michael Lewis has remarked, “Success is always rationalized. People really don’t like to hear success explained away as luck – especially successful people. Lucky [to] live in the richest society the world has ever seen, in a time when no one actually expects you to sacrifice your interests to anything.” Lewis (2012). 7  See for example Corak (2013), who finds that the elasticity of a son’s adult earnings with respect to his parents’ earnings – the “intergenerational elasticity” – rose from 0.3 to around 0.55 between 1950 and 2000 in the US, indicative of a decline in social mobility. Corak has also shown that the intergenerational earnings elasticity tends to be higher in more unequal countries; a phenomenon termed the “Great Gatsby Curve” by Alan Krueger (2012). 8  Government spending has increased in most countries around the world since the 1960s, reflecting increased spending on social protection, education and healthcare (IMF, 2014). And, looking forward, all OECD countries face increased budgetary pressure due to expected increases in age-related healthcare, long-term care and pensions (OECD, 2011b, Table 1.1). Merola and Sutherland (2012) analyse long-run fiscal sustainability in the context of these budgetary pressures. 9  E.g. Putnam (2001). 10  For a similar list see Shanmugaratnam (2013). 2  BIS central bankers’ speeches  behaviour. 11 As Michael Sandel argued, we moved from a market economy to a market society.
Miguel Fernández Ordóñez: The monetary policy strategy of the Eurosystem Speech by Mr Miguel Fernández Ordóñez, Governor of the Bank of Spain, at the Second Summit Meeting of Central Banks on Inflation Targeting, Santiago de Chile, 14 November 2007. *  *  *  Ladies and gentlemen, Let me thank Governor Corbo for his kind invitation to speak at this Second Summit Meeting of Central Banks on Inflation Targeting, hosted by the Central Bank of Chile. It is for me a privilege and a great pleasure to be here in Santiago and to have the opportunity to address this distinguished audience. I would like to begin my intervention today by recalling two important events that took place in 1999. In that year, the Central Bank of Chile adopted a full-fledged inflation targeting strategy with a floating exchange rate. This monetary regime has served Chile well, providing a coherent and transparent framework that is credible in society at large because all the economic agents clearly understand the policy objectives and the rationale for decisions. 1999 was the same year that the Governing Council of the European Central Bank took up the responsibility for conducting a single monetary policy for the entire euro area, after a prolonged period of intensive preparations and successful economic convergence.