Journal Article
Monetary Policy Medicine: Large Effects from Small Doses?
Abstract: If inflation increases rapidly, how do we know that higher interest rates will bring prices under control? And how do we know how much of the monetary ?medicine? to administer? Economics relies primarily on observational data to answer such questions, while medical research uses randomized controlled trials to evaluate treatments. Applying that method to economics, the long history of international finance turns out to be an excellent laboratory to conduct monetary experiments. These experiments suggest that interest rates have sizable effects on the economy.
Access Documents
File(s):
File format is application/pdf
http://www.frbsf.org/economic-research/publications/economic-letter/2017/april/monetary-policy-medicine-using-quasi-random-experiments/
Description: Full text
Bibliographic Information
Provider: Federal Reserve Bank of San Francisco
Part of Series: FRBSF Economic Letter
Publication Date: 2017
Order Number: 09