different compared to twenty years ago. and what will the world look like in twenty or thirty years? if the riksbank is to continue to function for many decades, it needs to focus more on principles and combine clarity over the riksbank ’ s tasks with flexibility over how this can be achieved. now it is time to think again and make a new attempt. 9 see also consultation responses from the riksbank, ecb and imf, which is to say sveriges riksbank ( 2020 ), ecb ( 2020 ) and imf ( 2020 ), respectively. 7 of course, principled regulation must be balanced by democratic control. here, evaluation, transparency and insight into operations are key elements that ensure that monetary policy is being conducted efficiently and appropriately for the public good. new demands for analysis – both in theory and in practice the financial crisis entailed new demands being placed on the monetary policy analysis. the old models have been further developed over the last ten years and supplementary approaches have been given a more prominent role in central banks ’ internal discussions. 10 one way of describing the implications of the new analysis is that it is more disaggregated. if focus, prior to the financial crisis, was on a single policy rate that was to carry the entire burden of monetary policy, as it were, the analysis is now more detailed. partly this is because it places greater emphasis in how policy rate changes spread through the financial system, via various markets to other interest rates, all the way to the interest rates faced by companies and households. and partly it is because the analysis focuses on describing how measures other than policy rate adjustments, for example various types of asset purchase, affect the financial conditions, economic activity and inflation. to link back to a part of the reasoning above, it could be said that the new analysis has its starting point in the financial markets not being as ‘ frictionless ’ as the earlier models assumed. 11 new and old tools can be combined, depending on the situation the general level of interest rates in the world has fallen in recent decades, policy rates have fallen to zero or thereabout and new versions of old tools such as asset purchases have had to be used to provide monetary policy stimulation. but shocks in the transmission mechanism have also justified the emergence of new monetary policy tools. to an increased extent, companies are obtaining funding directly on the market, and not just via loans from the banks. this is the reason that central banks have gone

and some tentative conclusions about the future course of the economic policy debate in the european union. 1. there are important interfaces between monetary policy, fiscal policy and structural policy. problems concerning the composition of fiscal policy or the workings of the labour market affect the room to manoeuvre in monetary policy. this suggests that a vital dialogue will be needed between different parts of eu ’ s economic policy decision - making system that are involved in such matters. more of a joint appraisal will presumably emerge. new processes and institutions are also likely to develop. 2. the growing need for dialogue and a joint appraisal has already led to new tasks and developments for a number of eu institutions. many observers consider that this is true of ecofin, which as a leading actor in the construction of emu has responded to new requirements. one example of a completely new structure is euro 11, which is designed for the handling of joint issues by the euro area ’ s finance ministers. there are many other opportunities for dialogue, so those who fear that the ecb will be operating in something of a vacuum are likely to be mistaken. 3. issues concerning fiscal policies in eu / emu and labour markets have also arrived on the agenda in other ways, for example at the monetary committee. this is partly because many consider than monetary union has accentuated the need for a joint european discussion. with monetary union soon to be launched, moreover, the agenda has more room for other matters. the stability and growth pact is one example of earlier initiatives in connection with emu. various processes have likewise been started to bring the problem of unemployment into the limelight. 4. there are strong grounds, in the fields i have discussed, for keeping decisionmaking essentially at a national level. the effects of the policies, for instance in the labour market, mostly occur in the country in question. there are also considerable country differences in such matters as the premises for fiscal policy, the structure of government finances, labour market regulations and so on. still, the ongoing integration of markets, which monetary union may stimulate, is presumably exerting increased pressure for reform. the process that monetary union is now driving onwards is, in fact, fairly typical of eu cooperation in general. the european union is a highly decentralised organisation. power and political legitimacy are essentially located at the national level. the joint budget is limited. matters move forward in a process where external events, for instance in the global economy, and political initiatives modify the