This chapter argues that central banks find themselves between a rock and a hard place when it comes to green central banking. Either they endorse the project, exposing them to the charge that they lack the input legitimacy to do so, or they eschew taking into account climate concerns, thus undermining their output legitimacy. Our discourse analysis of central bankers’ speeches shows that disagreements among officials from the same institution regarding green central banking are grounded on issues outside their core (...) expertise. Furthermore, neither the conservative nor the progressive central bankers defend positions that have the potential to overcome the legitimacy dilemma we formulate. (shrink)

Given available technologies, current consumption behaviour is incompatible with the goal of keeping global warming below 2 °C. Economists present carbon pricing as the most efficient tool to induce people to adjust their consumption behaviour. This Perspective critically analyses the ethics, economics and politics of one key form of carbon pricing: carbon taxes are levied to discourage fossil-fuel-intensive consumption. The core claim of this Perspective is that progressive individual carbon taxes (that is, taxes whose rate increases the more emissions an (...) individual generates) are not only more effective but also more just than the flat-rate carbon taxes prevalent today. (shrink)

Delegation to independent agencies can reap real benefits for policy-making. In the case of monetary policy, it shores up the credibility of the central bank. However, the discretion of IAs needs to be constrained to ensure their legitimacy. This letter focuses on one potential constraint, namely, the idea that IAs should not make choices on distributional trade-offs. Given that monetary policy today has significant distributive consequences, if this constraint were respected, the independence of central banks would have to be repealed. (...) This would be just as undesirable as a monetary policy whose distributive consequences remain unchecked. Instead, this letter encourages the search for alternative solutions and puts forward three possible institutional arrangements to manage the tension between the distributive consequences of monetary policy on the one hand and central bank legitimacy on the other. (shrink)

The power to raise taxes is a sine qua non for the functioning of the modern state. Governments frequently defend the independence of their fiscal policy as a matter of sovereignty. This article challenges this defence by demonstrating that it relies on an antiquated conception of sovereignty. Instead of the Westphalian sovereignty centred on non-intervention that has long dominated relations between states, today's fiscal interdependence calls for a conception of sovereignty that assigns duties as well as rights to states. While (...) such a circumscribed conception of sovereignty has emerged in other areas of international law in recent years, it has yet to be extended to fiscal questions. Here, these duties arguably include obligations of transparency, of respect for the fiscal choices of other countries, and of distributive justice. The resulting conception of sovereignty is one that emphasises its instrumental as well as its conditional character. Neither state sovereignty nor self-determination is an end in itself, but a means to promoting individual well-being. It is conditional in the sense that if states do not live up to their fiscal obligations towards other states, their claims to autonomy are void. (shrink)

Governments increasingly use their fiscal policy to attract mobile capital from abroad. This tax competition puts a strain on the international fiscal system by undermining the capacity of states to make autonomous fiscal choices and by exacerbating inequalities. The existing regulatory framework is not able to address these challenges. Yet, what considerations should guide our efforts for reform? This chapter argues that a first necessary step consists in understanding the principles that justify the state as the principal locus of fiscal (...) control in the first place. Building on an account of the legitimacy of the state and its fiscal powers, the chapter shows how tax competition is in tension with the principal objectives this account assigns to the state. It then outlines a normative response to tax competition that relies on both reforming jurisdictional rules and redistribution between states. (shrink)

Commercial banks such as UBS and HSBC embroiled in scandals that in some cases exposed lawmakers themselves as tax evaders, multinationals such as Google and Apple using the Double Irish and other tax avoidance strategies, governments granting fiscal sweetheart deals behind closed doors as in Luxembourg - the stream of news items documenting the crisis of global tax governance is not about to dry up. Much work has been done in individual disciplines on the phenomenon of tax competition that lies (...) at the heart of this crisis. Yet, the combination of issues of democratic legitimacy, social justice, economic efficiency, and national sovereignty that tax competition raises clearly requires an interdisciplinary analysis. This book offers a rare example of this kind of work, bringing together experts from political science, philosophy, law, and economics whose contributions combine empirical analysis with normative and institutional proposals. It makes an important contribution to reforming international taxation. (shrink)

Cohen’s book is one of the founding publications of Analytical Marxism, aiming to reconstruct and in some cases reformulate some of Marx’s core claims using the rigorous tools of contemporary philosophy. The first part of the chapter analyzes Cohen’s defense of the controversial idea of historical materialism. Can the idea that history follows some underlying law of progress, which is central to Marx’s writing, stand up to scrutiny? This part of the chapter discusses, first, the radical challenges to historical materialism (...) formulated by rational choice Marxists such as Elster; second, a series of objections against functionalist explanation in the social sciences more generally; and, finally, some modifications Cohen made to his account of historical materialism in his later writings and in response to these critiques. The second part of the chapter analyzes Cohen’s conception of exploitation to illustrate the theoretical potential of Analytic Marxism more generally. (shrink)

Monetary policy, and the response it elicits from financial markets, raises normative questions. This chapter, building on an introductory section on the objectives and instruments of monetary policy, analyzes two such questions. First, it assesses the impact of monetary policy on inequality and argues that the unconventional policies adopted in the wake of the financial crisis exacerbate inequalities in income and wealth. Depending on the theory of justice one holds, this impact is problematic. Should monetary policy be sensitive to inequalities (...) and, if so, how? Second, the chapter argues that the leverage that financial markets have today over the monetary policy agenda undermines democratic legitimacy. (shrink)

The G7 should address new, unprecedented and highly disruptive issues that characterize our complex world, rather than well-understood international problems that fit into existing categories. We argue that the G7 can do this by playing to its strengths – informality and like-mindedness in particular – in addressing emerging and transversal issues such as Artificial Intelligence (AI) and cryptocurrencies.

Dans cet article, nous présentons deux arguments en faveur d’une attention accrue des banques centrales à l’égard des implications distributives des politiques monétaires. En mobilisant la doctrine du double effet, nous montrons que la responsabilité des banquiers centraux quant aux effets distributifs de leurs politiques monétaires non conventionnelles est engagée. De plus, étant donné que le levier traditionnel de la fiscalité fait face à de sérieuses difficultés aujourd’hui, l’appui des banques centrales pourrait être décisif pour la réduction des inégalités économiques. (...) -/- Nous évaluons ensuite les arguments théoriques et empiriques soulevés par les banquiers centraux contre cette proposition. Nous concluons que ces objections ne minent pas l’attrait d’une responsabilité des banques centrales en matière de distribution. (shrink)

The idea that pushing for more equality comes at a cost in terms of economic efficiency is widely accepted. Underpinning this idea is the premise that some of the most productive members of society will work less if we lower their pay. If this is true, some argue, it justifies paying the most productive a premium to work, provided doing so benefits everyone. This chapter argues that the standard version of the incentives argument suffers from two important blind spots. First, (...) it assumes that the comparative advantage of the most productive members of society is rooted in their natural talents, that is, in a factor exogenous to the production process. Second, it adopts a static framework to analyze the bargaining process in which incentive payments are negotiated, where static means taking all informational inputs from the same moment in time. The chapter uses the debate between John Rawls (1999) and G.A. Cohen (2008) to illustrate the normative repercussions of making these two assumptions. The chapter qualifies as unjust incentive payments that reward individual productivity due to specialization rather than to natural talent. In addition, it argues that individuals would not be in a position to obtain such incentive payments if bargaining took place before rather than after the acquisition of specialized skills. Finally, the chapter discusses the objection that eliminating this type of incentive payments would be inefficient. (shrink)

Theories of justice and intellectual property are vast topics in their own right. The contributions to this volume examine how they relate. How do our justifications for protecting intellectual property fare from an ethical perspective? Any attempt to tackle this question in a relatively short chapter like this one will have to be restricted in scope. My claims are limited in four ways. First, I concentrate on one kind of intellectual property protection, namely patents. Second, the claims of justice put (...) forward concentrate on one context of justice, namely the distribution of health goods. Third, the discussion of distributive issues concerning health is limited further in that I single out the distribution of drugs rather than, for instance, access to doctors or hospital services. Finally, I adopt a cosmopolitan perspective, emphasising inequalities in the access to drugs at the international rather than at the national level. (shrink)

La concurrence fiscale internationale est une composante essentielle du paysage fiscal contemporain. Cet essai analyse les responsabilités de l’État dans ce contexte d’interdépendance des systèmes fiscaux. Il soutient que l’État a le devoir 1) de mettre en œuvre le projet collectif défini par sa population, 2) de respecter l’autonomie des autres États et 3) d’assister les pays démunis. Cette conceptualisation des responsabilités étatiques a des conséquences théoriques et pratiques. Du côté théorique, la conjonction des deux premières responsabilités pousse à abandonner (...) la notion traditionnelle de souveraineté́ comme non-ingérence. Aujourd’hui, une notion adéquate de la souveraineté́ doit être sensible aux externalités internationales produites par l’action d’un État. De plus, la conception de la souveraineté́ esquissée ici est compatible avec un impératif d’assistance envers les pays en voie de développement. Du côté pratique, le respect de ces responsabilités étatiques requiert un nouveau régime de coopération fiscale entre les pays. (shrink)

In recent decades, and in particular since the shift towards independent central banks, there has been no explicit coordination of fiscal and monetary policy. In the Eurozone, this lack of coordination represents an important flaw, especially since the Eurozone is not an optimal currency area. Complementing monetary union with a transfer union represents one possible solution. This paper argues that the negative impact of post-2008 and post-Covid-19 unconventional monetary policy on income inequalities provides a second reason to coordinate fiscal and (...) monetary policy. Among various institutional arrangements to implement such coordination, the paper defends the idea that the European Central Bank should be sensitive to distributive considerations when formulating its monetary policy. Such an arrangement would help both to contain the distributive side-effects of monetary policy and to at least partially remedy the flaw at the heart of the Eurozone as long as an outright transfer union remains unfeasible. (shrink)