The History and Main Functions of Central Banks

Macro – Central Banks and Monetary Policy

In this course, Professor Andrea Ferrero (University of Oxford) discusses the topic of central banks and monetary policy. In the first module, we look at the history of central banks and their main functions today. After that, we look at the institutional setting of central banks and the move towards central bank independence. In the next module, we discuss how a central bank sets monetary policy for a country. Then, we explain how these different instruments of monetary economy actually effect the real economy. Finally, we look at how central banks judge the economic outlook of a country and how they make policy decisions.

The History and Main Functions of Central Banks

In this module, we look at the history of central banks and their main functions today. In particular, we will focus on: (i) what the functions of early functions were, including a discussion of the Bank of England; (ii) the role of central banks today, including a discussion of monetary policy and financial stability; and (iii) the history of which functions central banks have tended to focus on, including a discussion of the Great Depression and Great Recession.