Political constraints on monetary policy during the Great Inflation

The U.S. Great Inflation of the 1970s was characterized by repeated, failed attempts at disinflation by the Federal Reserve as well as periods of inaction despite rising inflation. Previous research has attributed these failures to policymakers’ “misperceptions” about monetary policy and the macroeconomy. This paper argues instead that the Fed’s behavior during this period can be explained as a response to political constraints. Members of the Fed understood that a serious attempt to tackle inflation would be unpopular with the public and would generate opposition from Congress and the Executive branch. The result was a commitment to the policy of gradualism, under which the Fed would attempt to reduce inflation with mild policies that would not trigger an outright recession, and premature abandonment of anti-inflation policies at the first sign of recession. The Fed managed to disinflate successfully under Chairman Volcker only when the political constraints on Fed policy were lifted after 1979, allowing the Fed to abandon the policy of gradualism and knowingly take actions that risked recession. Evidence for this explanation of Fed behavior is found in Minutes and Transcripts of FOMC meetings and speeches of Fed chairmen

Political constraints on monetary policy during the Great Inflation

The U.S. Great Inflation of the 1970s was characterized by repeated, failed attempts at disinflation by the Federal Reserve as well as periods of inaction despite rising inflation. Previous research has attributed these failures to policymakers’ “misperceptions” about monetary policy and the macroeconomy. This paper argues instead that the Fed’s behavior during this period can be explained as a response to political constraints. Members of the Fed understood that a serious attempt to tackle inflation would be unpopular with the public and would generate opposition from Congress and the Executive branch. The result was a commitment to the policy of gradualism, under which the Fed would attempt to reduce inflation with mild policies that would not trigger an outright recession, and premature abandonment of anti-inflation policies at the first sign of recession. The Fed managed to disinflate successfully under Chairman Volcker only when the political constraints on Fed policy were lifted after 1979, allowing the Fed to abandon the policy of gradualism and knowingly take actions that risked recession. Evidence for this explanation of Fed behavior is found in Minutes and Transcripts of FOMC meetings and speeches of Fed chairmen.Great Inflation; monetary policy; Federal Reserve

Political Constraints on Monetary Policy During the U.S. Great Inflation

This paper argues that the Federal Reserve’s failure to control inflation during the 1970s was due to constraints imposed by the political environment. Members of the Fed understood that a serious attempt to tackle inflation would be unpopular with the public and would generate opposition from Congress and the Executive branch. The result was a commitment to the policy of gradualism, under which the Fed would attempt to reduce inflation with mild policies that would not trigger an outright recession, and premature abandonment of anti-inflation policies at the first sign of recession. Alternative explanations, in particular misperceptions of the natural rate of unemployment and misunderstandings of the nature of inflation, do not provide a complete explanation for Fed policy at key turning points during the Great Inflation. Evidence for this explanation of Fed behavior is found in Minutes and Transcripts of FOMC meetings and speeches of Fed chairmen. Empirical analysis verifies that references to the political environment at FOMC meetings are correlated with the stance of monetary policy during this period.Great Inflation; Federal Reserve; monetary policy

A Way Around the Divided House Majority

For observers of the U.S. Congress, the inability of Republicans to unite behind a candidate for speaker has been by turn fascinating, exasperating, and frightening. When and if a candidate is finally chosen, Republicans will breathe a sigh of relief, as will many commentators. The real crisis, however, will have just begun. [excerpt

Political Constraints on Monetary Policy During the U.S. Great Inflation

This paper argues that the Federal Reserve’s failure to control inflation during the 1970s was due to constraints imposed by the political environment. Members of the Fed understood that a serious attempt to tackle inflation would be unpopular with the public and would generate opposition from Congress and the Executive branch. The result was a commitment to the policy of gradualism, under which the Fed would attempt to reduce inflation with mild policies that would not trigger an outright recession, and premature abandonment of anti-inflation policies at the first sign of recession. Alternative explanations, in particular misperceptions of the natural rate of unemployment and misunderstandings of the nature of inflation, do not provide a complete explanation for Fed policy at key turning points during the Great Inflation. Evidence for this explanation of Fed behavior is found in Minutes and Transcripts of FOMC meetings and speeches of Fed chairmen. Empirical analysis verifies that references to the political environment at FOMC meetings are correlated with the stance of monetary policy during this period

In Solidarity

This edition of Next Page is a departure from our usual question and answer format with a featured campus reader. Instead, we asked speakers who participated in the College’s recent Student Solidarity Rally (March 1, 2017) to recommend readings that might further our understanding of the topics on which they spoke

Strategic Planning for Environmental Stewardship at Eastern Kentucky University

The 2006-2010 Strategic Plan for Eastern Kentucky University, under Strategic Direction 5.4, mandates the formulation of a plan to guide the University toward greater environmental stewardship. The creation and implementation of that plan is the charge of the Eastern Committee on Responsible Environmental Stewardship (ECRES), which was formed in September of 2005. On October 27th, 2006, ECRES hosted a Strategic Planning Workshop. This workshop brought together a wide range of paticipants, including elected officials, college and university representatives, and interested citizens. The result was a broad consensus in the identification of environmental goals and objectives toward which EKU should strive

Emergency logistics for wildfire suppression based on forecasted disaster evolution

This paper aims to develop a two-layer emergency logistics system with a single depot and multiple demand sites for wildfire suppression and disaster relief. For the first layer, a fire propagation model is first built using both the flame-igniting attributes of wildfires and the factors affecting wildfire propagation and patterns. Second, based on the forecasted propagation behavior, the emergency levels of fire sites in terms of demand on suppression resources are evaluated and prioritized. For the second layer, considering the prioritized fire sites, the corresponding resource allocation problem and vehicle routing problem (VRP) are investigated and addressed. The former is approached using a model that can minimize the total forest loss (from multiple sites) and suppression costs incurred accordingly. This model is constructed and solved using principles of calculus. To address the latter, a multi-objective VRP model is developed to minimize both the travel time and cost of the resource delivery vehicles. A heuristic algorithm is designed to provide the associated solutions of the VRP model. As a result, this paper provides useful insights into effective wildfire suppression by rationalizing resources regarding different fire propagation rates. The supporting models can also be generalized and tailored to tackle logistics resource optimization issues in dynamic operational environments, particularly those sharing the same feature of single supply and multiple demands in logistics planning and operations (e.g., allocation of ambulances and police forces). © 2017 The Author(s

Micromechanical Properties of Injection-Molded Starch–Wood Particle Composites

The micromechanical properties of injection molded starch–wood particle composites were investigated as a function of particle content and humidity conditions. The composite materials were characterized by scanning electron microscopy and X-ray diffraction methods. The microhardness of the composites was shown to increase notably with the concentration of the wood particles. In addition,creep behavior under the indenter and temperature dependence were evaluated in terms of the independent contribution of the starch matrix and the wood microparticles to the hardness value. The influence of drying time on the density and weight uptake of the injection-molded composites was highlighted. The results revealed the role of the mechanism of water evaporation, showing that the dependence of water uptake and temperature was greater for the starch–wood composites than for the pure starch sample. Experiments performed during the drying process at 70°C indicated that the wood in the starch composites did not prevent water loss from the samples.Peer reviewe

Population ecology of the sea lamprey (Petromyzon marinus) as an invasive species in the Laurentian Great Lakes and an imperiled species in Europe

The sea lamprey Petromyzon marinus (Linnaeus) is both an invasive non-native species in the Laurentian Great Lakes of North America and an imperiled species in much of its native range in North America and Europe. To compare and contrast how understanding of population ecology is useful for control programs in the Great Lakes and restoration programs in Europe, we review current understanding of the population ecology of the sea lamprey in its native and introduced range. Some attributes of sea lamprey population ecology are particularly useful for both control programs in the Great Lakes and restoration programs in the native range. First, traps within fish ladders are beneficial for removing sea lampreys in Great Lakes streams and passing sea lampreys in the native range. Second, attractants and repellants are suitable for luring sea lampreys into traps for control in the Great Lakes and guiding sea lamprey passage for conservation in the native range. Third, assessment methods used for targeting sea lamprey control in the Great Lakes are useful for targeting habitat protection in the native range. Last, assessment methods used to quantify numbers of all life stages of sea lampreys would be appropriate for measuring success of control in the Great Lakes and success of conservation in the native range