Political leadership of the European Central Bank

Abstract:

What role did the European Central Bank (ECB) play in EU governance, regarding the financial, the economic and sovereign debt crises? How should we understand ECB leadership from a theoretical perspective? Based on speeches, literature review and interviews, this contribution concludes that by using policies such as the Securities Market Programme and by promising to do whatever it takes (e.g. Outright Monetary Transactions the ECB supported the euro-area faced with an unprecedented crisis.

Its two presidents during the crisis periods were leaders in that they managed to get the ECB followers (its Governing Council; EU member states) willing to take part in a common enterprise solving the sovereign debt crisis with the bank using exceptional monetary policy tools.

This contribution argues that both Presidents Jean-Claude Trichet and Mario Draghi exercised transformative leadership and were willing to take action when no other leaders were willing or able to lead.