Power delegation and the European Central Bank's democratic deficit

Delegation involves both costs and benefits. That is to say that delegation is problematic as the principal and agent may have conflicting interests in any act of delegation. Related to this puzzle, I focus on the issue of democratic deficit in the European Central Bank (ECB) as a consequence of power delegation by the European Union (EU) member states in the euro area. Critics claim that the ECB suffers from a democratic deficit as the Bank is seen immune from the people of the euro area, although it profoundly affects their everyday life. The fact that the ECB is a supranational non-majoritarian institution and distances itself from national political arenas further intensifies the issue. Hence, this article aims to evaluate the alleged democratic deficit of the ECB. © Springer-Verlag 2005.