Did the FED respond to liquidity shortage episodes during the Great Depression ?

Olivier Damette and Antoine Parent

Post-Print from HAL

Abstract: The October 1929 crash led to a complete freeze of New York open markets. Studying the Fed monetary policy conduct in a nonlinear framework, using credit spreads between open market rates and the Fed's instrument rates as a proxy for liquidity risk, we present econometric evidence that the Fed was well aware of such risks as early as 1930, reacted to the financial stress and altered its monetary policy in consequence. Our outcomes revisit conventional wisdom about the presumed passivity of the Fed throughout the 30s.

Keywords: Central Banks; Nonlinear STR Models; Crisis of 1929; Monetary Policy; Monetary Cliometrics (search for similar items in EconPapers)
Date: 2018-01
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Published in Macroeconomic Dynamics, 2018, 26 (1), pp.23. ⟨10.1017/S1365100516001073⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: DID THE FED RESPOND TO LIQUIDITY SHORTAGE EPISODES DURING THE GREAT DEPRESSION? (2018)
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:hal:journl:hal-01762624

DOI: 10.1017/S1365100516001073

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().