Abstract
This paper explores the future of negative interest rates, and considers a number of economic, legal, and institutional objections to the normalization of negative interest rates as part of the monetary policy toolkit. First, it contextualizes contemporary monetary policy debates over negative nominal rates against the background of the modern monetary system and macroeconomic theory. Then, it sets out concerns about the economic effectiveness of the transmission of monetary policy, before turning to legal and institutional objections associated with negative interest rate regimes.
Keywords: negative interest rate, neutral rate, central bank independence, nominalism
JEL codes: B22, B26, E02, E17, E27, E40, E41, E42, E43, E44, E47, E50, E51, E52, E58, E60, E61, E63, G21
