TY - JOUR
T1 - Recent evidence on the relationship between money growth and budget deficits
AU - Hoffman, Dennis
AU - Low, Stuart A.
AU - Reineberg, Hubert H.
PY - 1983/1/1
Y1 - 1983/1/1
N2 - This paper examines the recent evidence on the extent to which the Federal Reserve accommodates Treasury financing activities by effectively monetizing newly issued debt. Various lag and lead formulations are used to determine the timing of FED actions. Results suggest that validation has been significant over the 1960-1980 period, and that, especially in recent periods, the FOMC has responded to capital market pressure which appears in advance of impending debt issues. Finally, we find in the limited number of observations available since October 1979 that there has been no substantive "break" in this accommodative policy despite the Fed's alleged emphasis on monetary aggregates.
AB - This paper examines the recent evidence on the extent to which the Federal Reserve accommodates Treasury financing activities by effectively monetizing newly issued debt. Various lag and lead formulations are used to determine the timing of FED actions. Results suggest that validation has been significant over the 1960-1980 period, and that, especially in recent periods, the FOMC has responded to capital market pressure which appears in advance of impending debt issues. Finally, we find in the limited number of observations available since October 1979 that there has been no substantive "break" in this accommodative policy despite the Fed's alleged emphasis on monetary aggregates.
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U2 - 10.1016/0164-0704(83)90094-0
DO - 10.1016/0164-0704(83)90094-0
M3 - Article
AN - SCOPUS:48749142748
SN - 0164-0704
VL - 5
SP - 223
EP - 231
JO - Journal of Macroeconomics
JF - Journal of Macroeconomics
IS - 2
ER -