NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Can the Fed Control Real Interest Rates?

Robert J. Shiller

NBER Working Paper No. 348
Issued in May 1979
NBER Program(s):   ME

Three hypotheses concerning the controllability of rationally expected real interest rates are examined here. These hypotheses, which are suggested by recent literature, assert in different senses that the stochastic properties of expected real interest rates are independent of the Fed policy rule. We discuss the meaning and implications of the hypotheses, and how they might be tested. Evaluation of the hypotheses is attempted by examination of the Fed's "quasi-controlled experiments," historical changes in policy regimes, Granger-Sims causality tests, Barro unanticipated money regressions, and other methods. Questions as to the relevance of any such methods are discussed.

download in pdf format
   (591 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w0348

Published:

 
Publications
Activities
Meetings
NBER Videos
Themes
Data
People
About

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us