New @LibertyStEcon post by my colleague Regis Barnichon and Geert Mesters on their forthcoming Econometrica paper. Across 150 years of US monetary policy, they find big gains came after Volcker, in the Fed's response to financial crises and supply shocks. x.com/NewYorkFed/sta…
Has U.S. monetary policy actually improved over time? Or was the apparent success of the modern Federal Reserve the result of more favorable economic conditions and better luck? The authors summarize their forthcoming paper, which develops a framework for comparing monetary policy across different economic environments. They ask how close policy came to the best response given the economic conditions and shocks policymakers faced and find that meaningful improvements in monetary policy occurred only in the last thirty years.View quoted post on X
nyfed.org/4z2AugZ
