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WORDS AND DEEDS: SYMBOLIC POLITICS AND DECISION MAKING AT THE FEDERAL RESERVE
Author(s) -
Granato Jim,
West William
Publication year - 1994
Publication title -
economics and politics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.822
H-Index - 45
eISSN - 1468-0343
pISSN - 0954-1985
DOI - 10.1111/j.1468-0343.1994.tb00099.x
Subject(s) - scrutiny , recession , ambiguity , presidential system , deception , politics , subject (documents) , positive economics , political science , political economy , economics , law and economics , law , keynesian economics , philosophy , library science , computer science , linguistics
The Fed has often been accused of using ambiguity, concealment, and deception when it is subject to intense scrutiny and pressure. We investigate this issue by examining the relationship between the Fed's policy statements and its subsequent use of a key policy instrument, the federal funds rate. Our analysis shows that the Fed usually does what it says it will do during times of economic distress (recessions), but that its actions are more inclined to diverge from its stated intent when a sluggish economy coincides with presidential elections.