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Working Paper
A Proposal to Clarify the Objectives and Strategy of Monetary Policy
Academic economists have perennially made arguments for the conduct of monetary policy constrained by an explicit rule. These arguments have gone nowhere. This paper advances a proposal to clarify Fed objectives and strategy in order to facilitate discussion leading to consensus over a desirable rule. Economists are likely to have more success in their quest for a rule if they follow the indirect strategy of pushing the Fed for more transparency about the systematic character of policy.
Journal Article
The Real Bills Views of the Founders of the Fed
The founders of the Federal Reserve desired to end financial panics. In order to achieve this end, they created a decentralized collection of reserve depositories ? the Federal Reserve banks. They also wanted to remove control of the financial system from Wall Street. At the time, policymakers understood financial panics as resulting from speculative excess, especially on Wall Street. These "real bills" views of financial panic originated in the 19th century American experience. They influenced monetary policy significantly until the post-World War II period.
Working Paper
A critique of theories of money stock determination
Many different models of money stock determination exist in the literature. An attempt is made here to understand why the differences in these models arise. Differences in models are ascribed first to the (usually implicit) role assigned to the price level. From this perspective, models fall into two categories. Models in the quantity theory tradition require that the price level adjust in order to cause the real quantity of money to equal the real quantity demanded. In contrast, in the real bills or banking school tradition, the nominal quantity of money adjusts in order to provide the real ...
Working Paper
Monetary policy in the early 1980's
A requirement for the study of macroeconomic behavior in the early 1980s is an understanding of the monetary policy pursued by the Federal Reserve and of the way this policy was implemented. In an attempt to fulfill this requirement, the formulation and implementation of monetary policy are discussed in this paper for the period of October 1979 to December 1983. Particular attention is paid to the choice by the Fed of the funds rate or the money supply as its primary policy variable. It is contended that the operating procedures adopted in October 1979 contributed to the cyclical behavior of ...
Journal Article
What difference would inflation make?
Journal Article
Japanese monetary policy and deflation
Journal Article
Opinion: Milton Friedman and liberty
Journal Article
Arthur Burns and inflation
Journal Article
After the accord : reminiscences on the birth of the modern Fed
Working Paper
ECB monetary policy in the recession: a New Keynesian (old monetarist) critique
Use of the New Keynesian model to identify shocks points to contractionary monetary policy as the cause of the Great Recession in the Eurozone.