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Determinants of the federal funds rate: 1979-1982

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  • Timothy Q. Cook

Abstract

On October 6, 1979 the Federal Reserve, in an effort to improve monetary control, changed its operating procedures to give greater emphasis to managing the growth of bank reserves. Some movements in the federal funds rate under the new procedures were an automatic response to deviations of the money stock from its short-run target. Most, however, resulted from judgmental actions by the Federal Reserve.

Suggested Citation

  • Timothy Q. Cook, 1989. "Determinants of the federal funds rate: 1979-1982," Economic Review, Federal Reserve Bank of Richmond, vol. 75(Jan), pages 3-19.
    • Handle: RePEc:fip:fedrer:y:1989:i:jan:p:3-19:n:v.75no.1
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    References listed on IDEAS

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    1. Robert L. Hetzel, 1982. "The October 1979 regime of monetary control and the behavior of the money supply in 1980," Economic Review, Federal Reserve Bank of Richmond, vol. 68(Jul), pages 3-15.
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    6. Alfred Broaddus & Timothy Q. Cook, 1983. "The relationship between the discount rate and the federal funds rate under the Federal Reserve's post-October 6th 1979 operating procedure," Economic Review, Federal Reserve Bank of Richmond, vol. 69(Jan), pages 12-15.
    7. Goodfriend, Marvin, 1983. "Discount window borrowing, monetary policy, and the post-October 6, 1979 federal reserve operating procedure," Journal of Monetary Economics, Elsevier, vol. 12(3), pages 343-356, September.
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    10. Gary S. Anderson & Marvin Goodfriend & Anil K. Kashyap & George R. Moore & Richard D. Porter, 1984. "A weekly perfect foresight model of the nonborrowed reserve operating procedure," Working Paper 84-04, Federal Reserve Bank of Richmond.
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    Cited by:

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    2. Huh, Chan G. & Lansing, Kevin J., 2000. "Expectations, credibility, and disinflation in a small macroeconomic model," Journal of Economics and Business, Elsevier, vol. 52(1-2), pages 51-86.
    3. Christian Calmes & Frederic Dufourt, 2000. "Nominal Dynamics in Expected Market-Clearing Models," Cahiers de recherche CREFE / CREFE Working Papers 126, CREFE, Université du Québec à Montréal.
    4. Bikbov, Ruslan & Chernov, Mikhail, 2013. "Monetary policy regimes and the term structure of interest rates," Journal of Econometrics, Elsevier, vol. 174(1), pages 27-43.
    5. Bordo, Michael D. & Schwartz, Anna J., 1999. "Monetary policy regimes and economic performance: The historical record," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 3, pages 149-234, Elsevier.
    6. Belongia, Michael T. & Ireland, Peter N., 2022. "A reconsideration of money growth rules," Journal of Economic Dynamics and Control, Elsevier, vol. 135(C).
    7. Liu, Yuelin & Morley, James, 2014. "Structural evolution of the postwar U.S. economy," Journal of Economic Dynamics and Control, Elsevier, vol. 42(C), pages 50-68.
    8. Jean Boivin & Marc P. Giannoni, 2006. "Has Monetary Policy Become More Effective?," The Review of Economics and Statistics, MIT Press, vol. 88(3), pages 445-462, August.
    9. Belongia, Michael T. & Ireland, Peter N., 2024. "The transmission of monetary policy shocks through the markets for reserves and money," Journal of Macroeconomics, Elsevier, vol. 80(C).
    10. Alan G. Isaac, 2009. "Monetary And Fiscal Interactions: Short‐Run And Long‐Run Implications," Metroeconomica, Wiley Blackwell, vol. 60(1), pages 197-223, February.
    11. Jean Boivin & Marc Giannoni, 2002. "Assessing changes in the monetary transmission mechanism: a VAR approach," Economic Policy Review, Federal Reserve Bank of New York, vol. 8(May), pages 97-111.
    12. Christian Melzer & Thorsten Neumann, 2005. "Changing Effects of Monetary Policy in the U.S. –Evidence from a Time-Varying Coefficient VAR," Computing in Economics and Finance 2005 144, Society for Computational Economics.

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