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Actual Federal Reserve policy behavior and interest rate rules Author info | Abstract | Publisher info | Download info | Related research | Statistics Ray C. Fair
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A popular way to approximate Federal Reserve policy is through the use of estimated interest rate equations, or policy "rules." In these rules, the dependent variable is the interest rate that the Federal Reserve is assumed to control and the explanatory variables are those factors assumed to affect Federal Reserve behavior. This article presents estimates of such a rule, using data from 1954:1-1999:3 but omitting the 1979:4-1982:3 period, when monetary targets were emphasized. Although the estimated coefficient on inflation is found to be larger in the post-1982 period, the difference is not statistically significant, and statistical tests fail to reject the hypothesis that the interest rate rule is stable across these two periods.
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Article provided by Federal Reserve Bank of New York in its journal Economic Policy Review .
Volume (Year): (2001)
Issue (Month): Mar ()
Pages: 61-72
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Handle: RePEc:fip:fednep:y:2001:i:mar:p:61-72:n:v.7no.1Contact details of provider: Postal: 33 Liberty Street, New York, NY 10045-0001 Email: Web page: http://www.newyorkfed.org/ More information through EDIRC
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For technical questions regarding this item, or to correct its listing, contact: (Diane Rosenberger).
Keywords: Monetary policy - United States ; Interest rates ; Other versions of this item:
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.: Dean Croushore & Tom Stark, 1994.
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Martin Feldstein & James H. Stock, 1993.
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Full
references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
Joseph E. Gagnon & Jane Ihrig, 2004.
"Monetary policy and exchange rate pass-throughThis article is a U.S. Government work and is in the public domain in the U.S.A.
,"
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"Asset Prices and Monetary Policy in the Euro Area: a tentative model ,"
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Ling Hu & Peter C.B. Phillips, 2002.
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Cowles Foundation Discussion Papers
1365, Cowles Foundation, Yale University.
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Alan Ahearne & Joseph Gagnon & Jane Haltmaier & Steve Kamin ... [et al.]., 2002.
"Preventing deflation: lessons from Japan's experience in the 1990s ,"
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Athanasios Orphanides, 2001.
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Finance and Economics Discussion Series
2001-62, Board of Governors of the Federal Reserve System (U.S.).
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Athanasios Orphanides, 2001.
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Working Paper Series
115, European Central Bank.
[Downloadable!] Orphanides, Athanasios, 2004.
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Katrin Wesche, 2003.
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Douglas Curtis, 2005.
"Monetary Policy and Economic Activity in Canada in the 1990s ,"
Canadian Public Policy ,
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Adrienne A. Kearney, 2003.
"The Changing Probability of a Monetary Policy Response to Inflation and Employment Announcements ,"
Eastern Economic Journal ,
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Ray Fair, 2002.
"On Modeling the Effects of Inflation Shocks ,"
Contributions to Macroeconomics ,
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Other versions: Alfred A. Haug & Syed A. Basher, 2004.
"Unit Roots, Nonlinear Cointegration and Purchasing Power Parity ,"
Econometrics
0401006, EconWPA, revised 16 Nov 2005.
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Other versions: Joseph E. Gagnon & Jane Ihrig, 2001.
"Monetary policy and exchange rate pass-through ,"
International Finance Discussion Papers
704, Board of Governors of the Federal Reserve System (U.S.).
[Downloadable!]
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