Padoa-Schioppa as Money Doctor: Multilayered Macro-Prudential Supervision and European Integration

The dominant narrative describes Tommaso Padoa-Schioppa as a rather intransigent, austerity-biased, market-preserving money doctor. He certainly was a leading actor in macro-prudential financial supervision, both at the national and supranational level. His personal engagement in many and diverse supervisory organizations testifies of his idea that financial regulation and stability are a crucial stabilizing feature in a highly unstable and interdependent world. Guiding expectations among market agents and providing a credible framework of financial rules is key to both stability and growth. This paper explores the connection between his contributions to financial supervision and the issue of an evolving and unfinished (thus particularly fragile) European integration project, challenging the idea that he was a radical market supporter.