Does the Federal Reserve Care About the Rest of the World?

Barry Eichengreen

No 19405, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Many economists are accustomed to thinking about Federal Reserve policy in terms of the institution's dual mandate, which refers to price stability and high employment, and in which the exchange rate and other international variables matter only insofar as they influence inflation and the output gap - which is to say, not very much. This conventional view is heavily shaped by the distinctive circumstances of the last three decades, when the influence of international considerations on Fed policy has been limited. I discuss how the Federal Reserve paid significant attention to international considerations in its first two decades, followed by relative inattention to such factors in the two-plus decades that followed, then back to renewed attention to international aspects of monetary policy in the 1960s, before the recent period of benign neglect of the international dimension. This longer perspective is a reminder that just because the Fed has not attached priority to international aspects of monetary policy in the recent past is no guarantee that it will not do so in the future.

JEL-codes: E4 N1 (search for similar items in EconPapers)
Date: 2013-09
New Economics Papers: this item is included in nep-his, nep-hpe, nep-mac and nep-mon
Note: DAE IFM
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

Published as Barry Eichengreen, 2013. "Does the Federal Reserve Care about the Rest of the World?," Journal of Economic Perspectives, American Economic Association, vol. 27(4), pages 87-104, Fall.

Downloads: (external link)
http://www.nber.org/papers/w19405.pdf (application/pdf)

Related works:
Journal Article: Does the Federal Reserve Care about the Rest of the World? (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:19405

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w19405

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().