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Claremont Colleges Working Papers in Economics, Department of Economics, Claremont McKenna College >
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http://hdl.handle.net/10419/31447
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| Title: | | Non-traditional open market operations: lessons from FDR's silver purchase program  |
| Authors: | | Burdekin, Richard C. K. Weidenmier, Marc D. |
| Issue Date: | | 2005 |
| Series/Report no.: | | Working paper series // Claremont Institute for Economic Policy Studies 2005-08 |
| Abstract: | | When faced with a liquidity trap, a traditional open market purchase will generally be ineffective. Theoretical studies have suggested that intervention in other markets could offer a means of escaping from this trap. We provide some empirical evidence on the importance of non-traditional open market operations by examining the economic effects of FDR's Silver Purchase Program. We employ a structural VAR to assess silver's role in influencing overall money growth, inflation and output over the 1934-1938 period. The results suggest that the US silver purchase program was effective and highlight the potential importance of non-traditional methods for reflating modern economies in a liquidity trap. |
| Document Type: | | Working Paper |
| Appears in Collections: | | Claremont Colleges Working Papers in Economics, Department of Economics, Claremont McKenna College
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