Estimating the macroeconomic effects of the Fed’s asset purchases
An analysis shows that the Federal Reserve’s large-scale asset purchases have been effective at reducing the economic costs of the zero lower bound on interest rates. Model simulations indicate that, by 2012, the past and projected expansion of the Fed’s securities holdings since late 2008 will lower the unemployment rate by 1½ percentage points relative to what it would have been absent the purchases. The asset purchases also have probably prevented the U.S. economy from falling into deflation.
Volume (Year): (2011)
Issue (Month): jan31 ()
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- Joyce, Michael & Lasaosa, Ana & Stevens , Ibrahim & Tong, Matthew, 2010. "The financial market impact of quantitative easing," Bank of England working papers 393, Bank of England.
- Hess Chung & Jean‐Philippe Laforte & David Reifschneider & John C. Williams, 2012.
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- Hess Chung & Jean-Philippe Laforte & David Reifschneider & John C. Williams, 2011. "Have we underestimated the likelihood and severity of zero lower bound events?," Working Paper Series 2011-01, Federal Reserve Bank of San Francisco.
- Taeyoung Doh, 2010. "The efficacy of large-scale asset purchases at the zero lower bound," Economic Review, Federal Reserve Bank of Kansas City, issue Q II, pages 5-34.
- Stefania D'Amico & Thomas B. King, 2010. "Flow and stock effects of large-scale Treasury purchases," Finance and Economics Discussion Series 2010-52, Board of Governors of the Federal Reserve System (U.S.).
- James D. Hamilton & Jing Cynthia Wu, 2012.
"The Effectiveness of Alternative Monetary Policy Tools in a Zero Lower Bound Environment,"
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Blackwell Publishing, vol. 44, pages 3-46, 02.
- James D. Hamilton & Jing Cynthia Wu, 2011. "The Effectiveness of Alternative Monetary Policy Tools in a Zero Lower Bound Environment," NBER Working Papers 16956, National Bureau of Economic Research, Inc.
- Flint Brayton & Eileen Mauskopf & David Reifschneider & Peter Tinsley & John Williams, 1997. "The role of expectations in the FRB/US macroeconomic model," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Apr, pages 227-245.
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