JOURNAL ARTICLE
Cite JOURNAL ARTICLE
Style
Format
Monetary Policy and Financial Deregulation in the United States
Credit and Capital Markets – Kredit und Kapital, Vol. 21 (1988), Iss. 3 : pp. 451–468
Additional Information
Article Details
Author Details
Prof. Robert H. Rasche, Michigan State University, 101 Marshal Hall, East Lansing, Michigan 48824-1038, U.S.A.
Abstract
Monetary Policy and Financial Deregulation in the United States
This study examines whether the continuing financial innovation and deregulation that occurred in the United States in the late 1970s and early 1980s was a potential source of significant difficulty for the conduct of monetary policy. The evidence suggests that the problems for policymakers arising from these sources were relatively few, and that the major structural change associated with the introduction of NOW accounts in 1981 could have been detected relatively quickly. This structural change was an increase in the interest elasticity of velocity which is contrary to the prevailing opinion about the likely impact of the introduction of interest bearing transactions accounts on the velocity of transactions money.