Postcommunist Central Banks: A Democratic Deficit?

Both proponents and detractors of central bank independence (CBI) view granting central bank independence as a domestic decision made for domestic economic reasons after domestic political consideration. However, postcommunist independent central banks began their lives burdened with a dual democratic deficit. Not only were they predominantly developed by and for international actors, but this rapid process occurred without building significant domestic support for these institutions. This paper explores the problematic implications of this democratic deficit and discusses how central banks might be better incorporated into democratic polities without compromising their countries' economic health.