Perceived FOMC: The Making of Hawks, Doves and Swingers
Narrative records in US newspapers reveal that about 70 percent of Federal Open Market Committee (FOMC) members who served during the last 55 years are perceived to have had persistent policy preferences over time, as either inflation-fighting hawks or growth-promoting doves. The rest are perceived as swingers, switching between types, or remained an unknown quantity to markets. What makes a member a hawk or a dove? What moulds those who change their tune? We highlight ideology by education and early life economic experiences of these members. The Hawk/Dove composition of the FOMC also matters for monetary policy as do the determinants that we isolate. They help explain deviations of the Federal Funds Rate from a forward–looking Taylor rule. This result has implications for the political economy of FOMC appointments. This research is based on an original dataset.
We thank Jonathan Rose for his discussion and Alan Blinder, Yuri Gorodnichenko, Rob Roy McGregor, David Papell and participants at the Shadow Open Market Committee (SOMC) 2018
Fall Meeting, at the SOMC 2019 Conference, at the seminar at the Federal Reserve of Atlanta,University of Houston and UNC Charlotte for comments and suggestions. The views expressed herein are those of the authors and do not necessarily reflect the views of the Banque de France and the National Bureau of Economic Research.