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Would it help to eliminate interest on reserves?

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Abstract

Although we can?t be certain of the size of the effect, the ECB?s recent experience suggests that eliminating interest paid on reserves held with the Federal Reserve would not substantially increase bank lending and money growth.

Suggested Citation

  • Christopher J. Neely, 2013. "Would it help to eliminate interest on reserves?," Economic Synopses, Federal Reserve Bank of St. Louis.
    • Handle: RePEc:fip:fedles:y:2013:n:8
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    References listed on IDEAS

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    1. Todd Keister & James J. McAndrews, 2009. "Why are banks holding so many excess reserves?," Current Issues in Economics and Finance, Federal Reserve Bank of New York, vol. 15(Dec).
    2. David C. Wheelock, 2010. "The monetary base and bank lending: you can lead a horse to water..," Economic Synopses, Federal Reserve Bank of St. Louis.
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